Memory and storage are two separate pools that perform separate functions on computers.
Memory, which is what you're looking at when you go to "About this Mac..." is where the stuff your computer is actively working on lives. More memory can mean more open programs or it can mean the existing programs can each open more or bigger files.
Storage is of course disk space - the software itself and the data itself when they're at rest.
Some things will occupy both spaces when running.
Newer computers can use memory to do other tricks to make things feel faster but Classic Mac OS doesn't really have any of those tricks so you don't gain anything from putting much more in than you're going to use.
192 megabytes of memory should be fine, it'll be a little tight for multi-tasking or heavy pro software but anything less than that it'll be good.
My comfort zone for a multi-tasking workflow with Mac OS 9 is about 256 megs of RAM. Anything more is really just extra for dual boot OS X systems or if you're doing work that's probably better done in OS X anyway.
There are a few (typically minor) disadvantages to running Classic Mac OS on a computer with a full gig of RAM Installed, namely each program takes a little bit more of the active memory because Virtual Memory has to be turned off some some tricks the OS can do to reduce memory usage are no longer in play.
I typically recommend leaving virtual memory on unless you have a Good Reason to turn it off.
The Beige G3s support 768 and the Blue G3s support 1GB, but if you're getting by fine with 192, that's not really where any of your problems are.
Look around on the system for old data files that are big, you can check on the size of each file by hitting command+I or clicking on it then using the menu to go to File -> Get Info. Deleting large numbers of small files doesn't always make a big dent in total usage, especially on big disks.
If your computer is still on its original hard disk from up to 25 years ago, it may be time to look for replacements. The stock disks in most G3s were 4, 6, or 8-gig Quantum IDE drives, which probably felt like a lot in 1997-99 but if you've put 25 years worth of data on it, may be filling up.
One more thought: Are you at
the metal fabrication shop? We had another forum member from there, if they're still available to you, they may be able to help, but I think there may also be community members from there. It may be worth posting a feeler for vintage mac support services, maybe someone from the area would be willing to hop over and take a look in person or perhaps over a video call, just depending.