I was at my local office supply store and overheard a guy looking at memory for computers. He was telling the salesman that this was the bad part in the customer's computer and he needed a replacement.

Stupid question I know, but how did he know that this memory chip was the bad one? Is that what the diagnostic CD does?

There are memory diagnostics tool in windows or theres several on ubcd or hirens, mostly various flavours of memtest, or you can test by putting a stick thats known to be working in, thats why you try one stick of ram at a time in the different slots, sometimes its the slot thats the problem not the ram and one stick at a time because some brands won't play nicely with each other, kingston are worst for not working with others but i have seen it happen with other (had a samsung stick and an unknow brand other week wouldnt work together)

Just downloaded Hirens and am working on putting it on a DVD. Now to play around with it and see what it does and how it works.