64bit Windows 7 (and Windows Vista) have a built-in limit of not being able to use the last 25% of RAM. You will get a low memory warning when you get close to the limit. Even if you disable that warning, applications will run out of memory and crash since the OS will refuse to allocate memory from that last 25%.
That was fine when Vista was designed, when machines had 1 GB of total memory, but is pretty daft for today's 8 GB machines. Yes, the system will run cache, etc. on that extra 2 GB, but running out of memory when you have "merely" 2 GB left....
NB: this has nothing to do with the page file. If you limit the page file to a sensible size like 2 GB, you will still see this behavior. The system will cram the page file to the last byte while refusing to touch that 1/4th of the RAM.
Does Windows 8 change this behavior? Is there now some fixed minimum free RAM requirement, like 512 MB, or is it still 25%? Can you actually adjust the low memory limit?
EDIT: Here is another older post here which discusses this same behavior on Windows 7. There is fixed 25% limit in Windows 7 and I'd like to know if it's still in Windows 8. Windows 7 / Page File Disabled / 12 GB RAM / 2+ GB RAM free and "your computer is running low on memory"
Edit2: Here is another link discussing the low memory warning and how to disable it. Note he claims the limit for RAM usage is 80%, not 75%. It would seem to be correct as you can in fact allocate 6.4GB of RAM with 8GB machine. Anything above and beyond that goes to the pagefile, though. http://halflight.com.au/2011/04/06/how-to-disable-low-memory-warnings-and-the-advantages-of-removing-the-page-file/
Edit3: a Here's couple of process explorer screenshots that demonstrate how it goes down. Exhibit1: https://dl.dropbox.com/u/42068601/sysinfo.jpg
Exhibit2: https://dl.dropbox.com/u/42068601/sysint2.jpg
You can see that Windows 7 will use the memory 6.4GB as the very last resort. I have low memory warning switched off here so programs crashed at the last screenshot allocation. With low memory warning turned on, it starts nagging before you can push OS to use that remaining 1.6GB.
The question is not "Is it OK windows does not want to allocate last 20% of RAM because X", it's "Does Windows 8 still behave this way". With 16GB this really becomes dumb.