The documentation detailing Java memory limitations and Linux JVM's is a bit sparse and most concerns the ancient limitations of 32bit JVMS. No 1.4/2/3GB heap size limit exists on modern 64 bit Linux systems (fx. Debian Etch for AMD64) and it is now perfectly possible to use the following JVM options:

-d64 -server -XX:+AggressiveHeap -Xmx6656m -Xms6656m -Xss128k
-XX:+DisableExplicitGC -XX:ParallelGCThreads=4 -XX:+UseParallelOldGC
-Dcom.sun.enterprise.server.ss.ASQuickStartup=false

Which sets a 6.5GB heap size with aggressive garbage control, disables explicit code calls to the garbage collector (System.gc()) and uses 4 threads for garbage collection.