As I understand it, all of your game's data, including entities and their textures, etc. are stored in the engine's internal data structures (the Nexus), which live in system RAM. When the engine decides that something should be visible, it's texture must exist in video RAM.
I could be wrong (Dan? JCL?), but an entity's texture might have been removed from video RAM, but still exist in system RAM. So, I would think that reducing texture size and/or number of textures would decrease Nexus size requirements.
HTH,
CrownStem
