Originally Posted by Sasky
Yeah, it depends on how much system memory you have. You probably don't want to push it to say the 4GB range if you have 8GB of RAM.
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Note quite true. The game itself is still a 32 bit application so it cannot use more the 4 GiB memory, regardless how much the computer has.
This lua memory limit (propably) only says how much of those 4 GiB can be taken up by Lua (and thus addons).
If you set it too high, addons might take too much memory and then there is not enough for the graphics and game left (so game OOM exception might become more common). Raise it carefully and ideally by multiplying the original value by 2.