The 32-bit versions of operating systems (not only Windows) will use some of the 4GB address space to address I/O devices (called memory-mapped I/O), so some of the physical memory will never be used. That's why you see only 3GB available.
Use the 64-bit version, and that problem goes away.
As far as I know, Windows licence keys can be used interchangeably on 32-bit and 64-but versions of the same O/S. So if you can get hold of the physical media EXACTLY the same version os the one you are using, your existing key should work, and you won't need to pay the "Microsoft Tax" again.