This is the memory that your onboard video card uses. It's basically a cheap way of doing onboard video. The video card takes control of whatever amount of ram you specify and the rest of the system cant see/use it. If you can spare it set it to 32 MB or more.
If you are using an AGP card, you will want to turn this to 0. I am surprised it even offers the option when you have the AGP card installed, what board are you using?
I agree with SeanOMatic. Check to see if there is an option to use onboard video versus an AGP/PCI card. I don't think it is an autodetect situation. Once the add-on card is selected, the shared memory option should get disabled.
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