Now I'm no expert (quite far from it, even), but from what I've picked up, video card memory is basicly how much your screen can hold at one given timestamp. The more memory, the greater the resolution you can set (given that the bus speed, and the likes of it, 're high enough).

By all means, feel free to correct me, as I was given a 30 second explenation narrowed down from a 30 min presentation xP