It depends. If no games are allowed, then 1-2 GB are mostly enough for mundane usage, however, throw in a few MC servers in an OVZ box and RAM will be needed.
We have people use all 8 GB RAM in OVerZold and not maxing the CPU. In fact I move them around so the big ram ones will go on the servers with high cpu usage and the cpu intensive on those that are low on RAM.
Rnning a DB in 8 GB ram should be mighty fast without loading the CPU (I am not talking monsters that need 4x 8 real cores and 512 GB RAM, but usual heavy DBs)
The main usage is shared hosting and games though.
We kept having demand for them (heck, people asked for larger than 8 GB iwstack instances and running heavy Windows inside) but OVZ is not doing everything, so we launched XenPower, less ram but more CPU and disk. It's been a massive hit, yet OVerZold usage does not decrease we barely manage to have stock, and there are tens of 8GB instances in the cloud.
There is a demand for high RAM VPSes, people want HA, snapshots, templates, imprating/exporting VMs installing from own ISO, creating complex setups with isolated networks, load balancing, external firewall, IPSec site-to-site and all with hourly billing, so, an 8 GB instance costs pennies a month if only up for a few hours.
Actually, to be honest I think the demand for high RAM VPSes is bigger than the regular LEBs, I mean there is stock for the lower ones (which is is something new those were flying fast before) and people ask for the big ones, Biz Xen was hardly selling one year ago in 1 GB variants, since then had to create 2 GB ones and even have a few people asking for a merger of two to run 4 GB at a very high price. At that price a dedi is much cheaper, but cant beat the power that a much bigger server can offer when almost all resources are available to you almost all the time if needed. Not to mention RAID, much better network, quiet and few neighbours.
I used to reccomend dedis over 8 GB and iwstack had an 8 GB instance just to have there in case someone will ever need one, but the usage was pretty steep from the start. Now we had to create 16 GB ones where people run DC edition Windows Server.