This issue occurs because the computer does not have sufficient memory to complete the requested operation.

Take a look at the Performance tab of Task Manager.  The 3 numbers under "Commit Charge" show how the system is using memory.  "Total" is the amount of memory now being used.  "Limit" is the amount of memory (physical RAM plus page file) available.  With 4 GB of physical RAM, I would expect this to be 8 GB.  "Peak" is the maximum amount of memory (real plus virtual) used since the last system start.

How does "Peak" compare to "Limit" on your system?

The problem is probably related to the fact that a process running in a 32-bit operating system can only address 4 GB of memory.  Although a process can use more than 4 GB of memory by swapping pages in and out of physical RAM, it may be that the complexity of your model is making this particular modeling software attempt to address more than 4 GB all at once, and therefore choke.