Humor me... You need more memory to run this? It is memory intensive?
Of course. A VM is basically a large application running on the native operating system. Whenever you run an application, the operating system must allocate memory to it. With me so far?
With Parallels you're running an application that is another computer (guest), inside the native one (host). The host must have enough memory that it can assign the application (the guest OS) enough for -it- to run satisfactorily.
I have a MacBook (the little one) with 2GB of RAM. I regularly run a WinXP VM, with 1GB assigned to the XP VM, and 1GB remaining in OS-X. If I had 4GB of RAM, I'd probably give the XP VM a bit more, but XP runs well in 1GB.
Win7 likewise does well in 1GB. Vista, no, but I'm not running Vista.
So in general, figure you need total physical RAM equal to what you want in BOTH operating systems. I'd call that memory intensive, but it's no surprise that it is so.