...Old people give me headaches.
If you install a 64 bit operating system, then your it WILL see all of your memory. You must make sure the version of windows you're installing is 64 bit. 32 bit will reserve so much and not let you use all of your memory if you have 4gb or more.
Any linux/windows 64 bit operating system will see and use all of your memory (yes some will still be set aside, that is normal.) Although I strongly suggest Linux, it's pretty idiot proof on messing things up. Then again, the bad thing is...is that it's also idiot proof in preventing the average joe from figuring out how to use it and do exactly what they want to do.
You can run RunUO in wine. You do NOT need windows on wine, that doesn't even make any damn sense at all. Wine you install Wine, you will also need to install the .net framework ontop of Wine. RunUO is a .net program, so it needs this in order to run on Wine, and windows. I've ran RunUO on my linux setup, still do. I know plenty of people running their server on Linux, it's very doable if you actually know what you're doing.
I would recommend Linux any day over Windows, as long as the user could actually use it without feeling super confused and fail at doing most of everything other then surfing the net (still not sure how people don't understand a simple os like Ubuntu...) I would never recommend Linux to an old guy though, unless he has had a computer since they first became mainstream and he actually knew a little about them.
And not that Nerun's Distro isn't great, I love it and use it myself. But stable of them all...what other systems are you comparing it to?