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Please report back whether it helps. My work desktop has 2 GB but also has some performance issues with SQL Developer, not only with large result sets but also those containing blob/clob columns with a lot of text. I might be mistaken, but I remember it working better in earlier versions. It just seems unresponsive in general. If I don't use it for a day or so (but leave it running), reopen the window, and right-click a database to connect, it takes 10 or 20 seconds for the context menu to appear.
Upgrading hardware can be a very satisfying experience, especially as it is almost always inexpensive relative to the value of your time. Virtual memory/paging on Windows/PC hardware is a huge disappointment, so more physical memory on Windows is a real panacea. With 64-bit O/S becoming more prevalent, laptops and PCs are commonly available with 8G memory.
That said, I suspect few users have a business case for viewing hundreds of thousands of rows through a graphical user interface.
Getting back to the point about java memory management, I want to put in a plug for the new Garbage-First Garbage Collector. It will be production in JDK 1.7, but may be accessed in JDK 1.6 u14 & up as an experimental option. The more recent the update revision, the better. Just add something like this to your sqldeveloper.conf file:
It does a much better job of actually freeing unused memory from the O/S perspective.
To read more about it: http://www.oracle.com/technetwork/java/javase/tech/g1-intro-jsp-135488.html