Hi,
So far I use the Oracle 8i 8.1.7 is pretty stable on wins 2K Professional for single instance. If u want to create more than 1 instance, probably u need to upgrade ur 256RAM in order to run smoothly.

Until Recently, I just upgrade my personal machine to Oracle 9i Rel 2 which need more resources in terms of RAM and Harddisk space, so I am not encourage u to use Oracle 9i if u want to run it on 256MB RAM machine. Also please check ur harddisk space available before install.