Not sure that is all of it. You can try turning down the max total memory to eg: 64mb and see what you can still run. An awful lot of stuff just can't, while similar applications in conceptually higher level languages (eg: Python, PHP, etc) happily execute.

The various factors I see are:

    - JVM overhead 10-15mb seems to be required just to get off the ground,
      which directly relates to the JVM replicating a bunch of OS 
      functionality (inevitable tradeoff for portability)
    - Missing value types - any complex data structure ends up with 
      big overhead from storing references
    - Stack frames - if you need a lot of threads you need a lot of stack,
      and a surprising number of threads run

Some of this will get addressed in upcoming releases, will be interesting to see how it goes.