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Innerspace window shows 706 Mb texture memory available, I tried fiddling with windows gfx settings and the like but it still stays around 700Mb.
Is this normal? My gfx card is a 5970 and has 1gb ram available, shouldnt the texture memory available say 1gb and not 700mb?
Texture memory available isn't necessarily the same as the amount of RAM on your video card. In fact, before video cards had so much RAM it was pretty common for it to show more than was available on the video card -- because it could borrow some of the system RAM.
Now if you're using Windows Vista or Windows 7, I believe some may be used/reserved by the OS.
Unless it drops below 25-50mb during gameplay, I wouldn't worry about it