It does boost your graphics memory to 512MB. I checked under System Profiler. I haven't really seen a noticeable boost in frames per second but I don't check FPS often.
Yes, although it does increase your graphic memory to 512, it is still shared memory. So there might not be much improvements in graphic performance. But in theory yes.
I've only played Minecraft and Team Fortress 2 since upgrading my RAM. You'll get a bigger boost going into Windows for gaming then from the RAM most likely. Also, if you want to view your frames per second in Steam games (I think this works in most), type cl_showfps 1 into the developer console. To remove it, type cl_showfps 0 or just relaunch the game.