You will need a 64 Bit OS to see all of it. XP64 or Vista64 will do. There are several factors as to why you can't see all of it, but basically, it is because other hardware is using some of the 4gb of available memory space that a 32 bit OS can use.
There is NOT a 3gb limit. A 32bit OS can address 4GB of RAM. 4GB is the max. You then have to deduct the space reserved by other hardware (i.e. video memory). This all adds up. On some systems, it only adds up to .25 Gb and on others is may add up to over 1GB.
A 64Bit OS doesn't have the 4GB limitation. It can address the 4GB that you have installed plus any extra that your hardware reserves.
In a desktop (or workstation), this is even more important as we can often physically fit more than 4GB of RAM. Some of our systems can fit up to 32GB and a 64 Bit OS is the only way to use all of that RAM.