if you get the status message “low internal memory” your phone memory has gone from ca 337mb free memory to something like <70mb free ram. it is not a problem with the internal sd-memory, but the limited amount of ram of the galaxy, which was advertised of having 512mb ram, but effectively one can only use 337mb, as system processes or else use the other space.
the message is due to running processes that consume a lot of memory, usually resident daemons that a user installs, such as keyboard apps or else.
one thing you can do to get rid of the message, is to stop those services. if you need them running, try moving them to the sd-card, so they consume less internal ram.
to see the memory consumption which triggers the message go to
settings and see the memory indicator there.
another thing you can do, if youre using a mod, is moving things out of /datadata, see this script:
http://forum.xda-developers.com/showthread.php?t=1444333
another thing that presumeably could be done to increase the threshold value for the message beeing triggered. still to be found out if there is such a setting somewhere in android/cyanogenmod.
update 09/21/2012: Message seems to be gone in Cyanogenmod10 (currently only nightly buidl available for the i9000)
update 19/07/2013: no more message since Cyanogenmod10 – 10.1
fernsehballett 