Windows 7 - Help with allocating more memory to Minecraft

I have 4GB of RAM and it uses maybe half a gig. I use an extensive amount of mods and I know that it'll lag the game and cause it to crash. After doing some research I've seen some people allocating more memory to minecraft by creating a .bat file and inserting this coding (assuming I am using the correct words. Feel free to correct me):

java -Xmx1024M -Xms1024M -jar "C:\Users\Adrian\Desktop\Minecraft.exe"

When i run it, I can only get it to run up to 1524. anything further and it says in CMD:

Error occurred during initialization of VM
Could not reserve enough space for object heap
Could not create the Java virtual machine.

Any suggestions with course of action I can take to give it more memory? I'd like to get up to 2.5GB because of how much memory Minecraft likes to snack on.

The reason you can't allocate more RAM to your server then 1524 is because Minecraft servers on a 32bit machine can only process up to 1.5G's of RAM. Any more then that would just give you errors. I suggest upgrading to 64bit.

But in my personal experience if you are playing in SP mods shouldn't give you much lag. Especially if it had 1.5 gigs allocated to it. SP doesn't cause much FPS lag with mods, it's SMP that you gotta worry about.

Good luck friend
Hope this helps