If phpinfo() says you've only got 128mb, then that's what's been allocated to PHP. I've found 128mb to be insufficient for many MODX Revo sites -- that could easily be a factor in your errors (the memory error in particular). You can't change that if you're on shared hosting -- you'd have to find a host that offers more memory (and that usually costs more, unfortunately). There are MODX hosts listed here:
http://modx.com/partners/hosting-saas/ -- I rent space on my server too.
Re the progress bar not going away: that's a nondescript symptom of any number of problems, unfortunately. One common underlying cause is incorrect permissions: the manager tries to do something with a file, and it can't, so the Ajax request hangs. Ajax requests are kind of a pain like that because instead of YOU making the request from your browser, the PAGE is making the request. It does make for a cleaner user-experience and it makes for faster performance because portions of the page can reload without having to reload the entire page, but the downside of Ajax is that all the error messages that would normally come directly to you and your browser instead get sent back to the requesting page, making it that much more difficult to debug and fix.
Another insidious cause of the zombie progress bar is a bum plugin: the plugin hangs, and the request never completes. Third possibility: mod_security (see
http://rtfm.modx.com/display/revolution20/Installation+on+a+server+running+ModSecurity) might be intercepting the requests and thwarting them. You have to go over your PHP/Apache logs (and mod_security, if installed) to help identify the error.
One of the most helpful things in situations like this is to re-run the setup: download the same (or newer) version of MODX and upload it to your site (see the upgrade instructions:
http://rtfm.modx.com/display/revolution20/Upgrading+MODx). The setup process will test directory permissions and will alert you to anything that might need adjusting.