Replace your RAM, there's no reason why a DDR400 should not run stable at 400mhz with the advertised timings, if it's still under warranty, RMA it, that's just not right.
Also, while you are at it, you should invest in another faster stick of 512mb, prefferably PC4000. I've noticed one of your sticks is DDR533, whereas the other is only DDR400. This automatically underclocks the DDR533 to 400mhz, thus bottlenecking your system as a whole. This may also be the reason for your instability, especially considering you are using two very different RAM sticks.
Two in dual channel would be your best option as it will reduce latency and increase speeds, but your budget probably won't allow it unless you can find another stick of the same PC4000.