Shared memory... It's a double-edged blade.
When you share your memory, you're taking that amount from your RAM, and putting it to your video card. As far as I know, this only happens when you use an on board video card (Which surprises me that you have such a large amount of vram in an onboard video card), and once again, as far as I know, it isn't possible to increase or decrease it.
There might be a tool out there to do so, but I use a PCI-E card, so I can't really tell ya.
Also, to answer your question:
Upsides:
•More video ram for larger screens
Downsides:
•Takes away RAM
•Can cause you to use HDD for RAM, which really slows down the comp
•Can't be changed, so you always will lose that extra 256mb of ram, no matter what you do.