Nope, desktop586 maxes out at 1GB. desktop supports up to 4GB.
desktop586 is built with only i586 optimizations and only supports up to 1GB; it basically exists because Mandriva still supports i586 CPUs. It only supports up to 1GB of RAM because basically no-one is running an i586 CPU with more than 1GB of RAM, and 'himem' support - supporting up to 4GB rather than 1GB of RAM - actually comes with an appreciable performance overhead that users of i586 machines would notice. This does leave a bit of a loophole in terms of One, though. One has to use desktop586 so it can be booted on i586 machines. If it used the regular desktop kernel (which is built with i686 optimizations), it couldn't.
In 2008 Spring, the only actual differences between the desktop and laptop kernels are:
i) timer lowered from 1000Hz to 300Hz, but we have NO_HZ enabled on both kernels anyway, so this actually makes very little difference to anything.
ii) Big kernel lock preempting disabled: this actually has no effect as it's only defined for an architecture we don't support.
iii) USB_SUSPEND enabled: post-2008 Spring this is no longer experimental so we've just enabled it in kernel-desktop.
iv) a bunch of modules for hardware that would never be in a laptop were not built to save a bit of space.
and that's it. That's the sum total of differences. Three that made no practical difference and one that's no longer necessary post-2008 Spring. That's why we dropped the laptop kernel in Cooker now. :)