The memory is used by the BlackBerryOS.
The same flash ROM holds both the BlackBerryOS *and* the personal information. If you need more memory, get the BlackBerry model 7250 (used on carriers that use the 6750)
BlackBerry uses a non-volatile flash memory filesystem, which keeps data alive even if you yank the battery out -- you won't lose your contact information. The same flash memory is used for both the operating system AND the contacts. And if you downloaded any third party software.
Memory is also used for the web browser cache, as well as swapfile (multitasking multiple applications by holding
+Esc ... you might have software running in the background on your BlackBerry.)
You can clear up some memory by clearing your browser cache (launch BlackBerry browser, click wheel, Options, go to Cache, clear from there) and then rebooting your BlackBerry by remove-reinsert of battery. That will not delete your information, don't worry. Even email drafts (If you want to reboot in the middle of writing an email, click "Save" first) will still be there. It takes about one or two minutes to reboot.
Don't worry about it, you only need to really worry about memory when you go below 1 megabyte.