More RAM is better than less in dual channel mode, there's very little real world performance to be had from dual channel.
For your configuration, use 2x1Gb sticks, 1 512MB and 1 256MB, for a total of 2.75GB.
Use the PC3200 RAM too, although it's still unlikely to make much of a noticeable difference between PC2700 and 3200.
Hope this helps.