Well most of that memory usage is the db cache. It probably can be done on a custom ARM based board however it isn't going to be a trivial project and you probably want the board to have a gig of memory. The UXTO is only going to get larger over time.
Thanks DeathAndTaxes. If there is a "gotcha," I think it is this. Earlier I proposed storing the UXTO on the SD card rather than RAM, organized in some efficient manner for fast cross-checking. The UXTO would be updated each block, and earlier in the thread I showed that erase/write cycles every 10 min should still provide the memory card with several years of life.
Am I missing something? Is there a reason I need to store the UXTO in RAM that I cannot see? It seems to me that even 64 MB or RAM would be sufficient (this is available on a 6x8mm ball-grid array chip for $1.50). 64 MB gives lots of room to pool the unconfirmed transactions, accept new blocks from peers, etc.
Like you said, this certainly isn't a trivial project. For the time being, it is a thought experiment: "
how simple, cheap, small, and low-power can a useful bitcoin node be made?"