Unable to allocate memory when lots of memory is available (or cached)

This is a bit of an old one – but I still see a lot of people hitting this so I wanted to get the answer out there.  The problem is as follows:

You have a large system with lots of memory, but when you try to start a virtual machine you get an error message stating that we were unable to allocate the amount of RAM needed to start the virtual machine.  When you open task manager you see that there is plenty of free (or cached) memory available.

The answer is that you need to go here: http://support.microsoft.com/kb/953585 and download the hotfix.  This problem is caused by a bug in the Windows memory manager that is causing it to tell us that the memory is not available when it actually is.