I was just reading Mike’s blog, and I saw this in one of his posts:

Mental Note: Installing the CF 2.0 framework CAB file caused a sort of “low memory” error. This device, it appears, has a memory deficiency. Even after closing all open applications, the available application memory was less than when all the applications were open. Odd. Soft reboot, continue, investigate later.

I’ve run into this problem a couple times. It isn’t actually happening because the device doesn’t have enough memory, but because there isn’t enough memory to install the .NET CF. The cab file has to be copied over and remain on the device as the framework is installed. That puts some hefty requirements on memory, but only during install. If you can make it past that point, you’ll be fine.

While Mike managed to get it installed, the number one thing I can recommend that you do if you run into this is simply to clear your Internet Explorer cache.

I did this the other day when I didn’t have enough room on a device for the installation of the SQL Server Mobile bits. It freed quite a few megs, and I was able to finish the install without a problem.

You can also try deleting some of your pr0n, but only as a last resort :)