256MB SO-DIMMs are a bit of a mystery bag...the problem is the early iMacs are a bit finicky about 256MB SO-DIMMs, in that with some, they will only address the first 128MB of the SO-DIMM.

For the record, 128MB ones aren't that hard to find or expensive...Microseconds, in Sydney sells 'em for $20 a piece...or at least they were back in April when i got my iMac stuff there. Good people to deal with.