Avoid all this talk of "low density" and "high density". One year's high density is the next year's low density. In particular, 128Mb SDRAM chips were at various times referred to as both, so prepare to get even more confused if you try to follow those terms.
It's much simpler if you just follow the numbers (and stay sharp with bits vs Bytes). i440BX has three limitations: 1) max 128Mb per chip 2) min 8b width per chip 3) max 2x 64b width per DIMM. So, max DIMM size is 16 2x64/8=16 chips of 128Mb each, totalling 256MB.
If you attempt to use DIMMs with higher chip density, the board will only be able to address the first 128Mb per chip. So your 256MB DIMM probably has 8 chips with 256Mb, which leads to 8 x 128Mb = 128MB being used. Your CPU-Z reads the SPD EPROM on the DIMM which correctly identifies it as a 256MB DIMM, but the i440BX can't do a thing with that.
512MB has 16 chips of 256Mb each, so would be addressed as 16 x 128Mb = 256MB. It would work, but you'd waste half the capacity. Far better to go for for 256MB DIMMs with 16 chips, as pentiumspeed recommends.
One possible pitfall: there were two kinds of 256MB DIMMs with 128Mb chips:
1) Electrically double-sided with 'regular' 16Mx8 chips
2) Electrically single-sided with 'Via only' 32Mx4 chips (even though it has 16 chips, physically located on both side of the DIMM)
The latter aren't really Via only, more "anything but Intel" - remember the "minimally 8b width per chip" restriction. A BX board won't even boot with one of these DIMMs.
So: go for 256BM DIMMs with 16 chips, each with 16Mx8 structure. And you're safe.