Prior to signing off and giving my Aspire iDea 500 a thorough soak-test I've flash upgraded the BIOS so that 3GB DDR2 in total can be fitted. How this was done:

Using the WinFlash utility available through the Acer support site a backup of the existing BIOS was saved via 'File' > 'Save old BIOS'. The BIOS was then flash upgraded via 'File' > 'Update BIOS'. The BIOS file itself is not in the same folder as the WinFlash utility but up one level and can be found by entering '*.bin'. Once the relevant .BIN file was selected I'd proceeded to upgrade the BIOS by clicking on 'Update' - This is normally a very nerve-wrecking experience as failed flash upgrades can result in you 'bricking' a device - basically rendering it unusable. After a BIOS flash upgrade a machine will more than likely need to be rebooted. Hopefully all is well and the BIOS has updated without any issues. Up to 3GB DDR2 can now be installed (in the form of 1 x 1GB and 1 x 2GB) and recognized by the BIOS.