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I've seen deployments with 100M records and even more, but to be honest, never on MS-Windows and never with such small amount of RAM... (my 5+ years old laptop has 8GB and 500gb HD).
However, the reported error may happen when you don't have enough db-locks available; as described in:
this is a parameter that needs to be tuned depending on the size/scalability of your deployment. Have you tried increasing that or are you still running with the default configuration?