I actually 'downgraded' from a 1024 megs of RAM to 512 megs of RAM a while back.
I did this because the Gig I had used fairly poor overclocking memory chips, so I sold it and bought myself a half gig of excellent overclocking BH-5 to replace it.
Long story short, after I switched to 512 Megs of RAM from a Gig, I noticed absolutely no degradation of in-game performance. Texture and map load times increased slightly, but my in-game FPS and smoothness was unaltered even with half the memory I had before. I was playing Doom 3, Farcry, and Warcraft 3 at the time (It is worth mentioning that I only game at 1024x768, but with as much eye candy enabled as my machine can handle). The difference was probably there, but so slight that I did not notice it.
My experience is purely anecdotal, but I'm not going to bother with a gig of memory with my new machine either - I still have that half gig of mint BH-5 and I intend to keep using it for awhile yet. A half gig of really fast memory with tight timings is enough for gaming in my experience, and much more fun to overclock.
In my opinion, the only reason for an overclocker to invest in a gig of RAM right now is to take advantage of Interleaving (depending on the platform you use).