Richard,
That's 1.5 x 256. I have 512Mb RAM, so my pagefile size should be 768. I have set that (768) as my max and min pagefile size already.
Nevertheless, I tried the lower figure to see if it made any difference to the Reserved System Space. Unfortunately it didn't.
I've Googled a fair bit for a solution to this and also run quite a few searches on the MS Knowledgebase, but no joy.
I mentioned SP2 in my previous post as being a possible solution. Having read up a bit on SP2 on the MS website, I don't think it will be the answer either - I think SP2 will leave this configuration as it is to facilitate a rollback, just like SP1 and Autoupdate have between them set the system up to facilitate a rollback.
My data is backed up - I've nothing to lose but my time and a bit of inconvenience

. I think I'll do another format and reinstall and be careful not to do ANY updates until SP1 is installed - I'm sure that's where I went wrong. Will let you know whether or not it solves the problem.
Cheers
AA