Task Manager shows it dangerously close to the 2GB per application limit. trImage is used to allocate space for the render buffers as well as other things, I believe, so there are a number of places it could be running into memory allocation problems. Many files are still loaded on loading a .tgd even if they're disabled too, and so they take up memory (objects for example).
What Jo meant by this not being a "bug" is that it's simply reporting a memory allocation error due to lack of available memory, which is a normal thing to encounter for an application. It is not an error in the memory handling in TG2 per se, it's just encountering a limit and reporting that - the cause of the error is the user trying to do too much memory-intensive stuff for a 32bit app.
It could perhaps handle the error better, but fundamentally the error is not due to a bug at least.
In any case it seems like your scene file is very memory-intensive for one reason or another. If you could describe it more or show lower-resolution test renders it might help in determining why it's so demanding. With 4GB of RAM the /3GB Windows switch might also help TG2 allocate more memory, but it's questionable whether that would resolve this problem.
- Oshyan