Carey, yes that is the case with cpanel. The price you have is correct too.
However, cpanel has introduced a new version which in tests drastically reduces memory load in VPS. Its currently in EDGE, so wont be stable for a while, but they clearly identify it as an sales issue and are working to reduce overheads.
I would go with 512 then it will be a performance boost when the stable version comes out.
see
CPanel WHM VPS optimisation