Hi there,
What I can suggest is to contact Wacom England. All in the beginning I did have a problem with the numbers on the upper side replacing my cursor and in a very friendly manner they explained every step I had to take.
I just say this because I am very reluctant to suggest you delete the Wacom and pentools keys in the registry...
I suppose that the first software install is still the cause of the problems.
About your memory for PS: 65% is reaaly more than enough.
In fact: Win98 can't really handle more than 128MB of SDRam. More to it is just plenty and it takes its percentage, not the quantity it needs.
Whe you contact Wacom, it might be useful to write down exactly what and when it happens.
Do you have problems when using it with other software, does it crash when painting, cloning, what screen resolution do you use, what is the MB of your video card, is it video on board, Matrox, GeFORCE, ATI Radeon, how are your systems resources (this is not RAM, but the memory Win uses for the graphic and hardware interface,...etc.
About these Systems Resources: Go to Control Panel, system and then you see a tab with your configuration. Here you can see how much of your resources are eaten up by software running in the background. Software like your Wacom, a virus scanner, progs you installed and also maybe even spyware.
To know what is running you can either go to google and search for Karens Powertools, or you can try MSCONFIG which gives you all the things that are starting up.
You can also press Ctrl+Alt+Del once to get a list of what is running.
My idea, these resources are often the cause of crashes etc...
To get rid of spyware, look for AdAware and get the latest file.
You can also run defrag after deleting all rubbish you find in the TIF and Temp folders.
It's also a good idea to clear your HDD once a year and have a fresh re-install of Windows. But do make a complete backup!!!
Success
I only know PS6 (a bit that is), so I can't really help with version 5.
About the memory setting for the tablet: Win automatically allocates memory to the hardware, so there is no setting like there is one on the Mac.