The world is unlimited. The server will get slower the further out you move, but more RAM generally equals more players. On the bukkit wiki, it is recommended that you have 1 gig per 10 players.
I have a 10GB server with a worldborder of 10000x100000 (5000 in every direction from spawn) using the plugin worldborder. Keep in mind I have 6 worlds so you could probably go with the same as I on 2 worlds.