Can you upgrade the RAM of an Android device? I'm sure many people like me are aware and annoyed by the extremely limited amount of RAM in Nexus S (512MB but only 300+ is usable), I have searched all over google for a solution to increase the amount of RAM available and came up empty (I tried swap file applications but they just broke my system's SD card partitions causing a complete reset).

I wonder if there is any hardware solution to this problem. Is it possible to swap the chip out for a bigger capacity one? I realize that it is not as simple as swapping out PC RAM from a dimm but I haven't seen any schematics for the chip layout on the ARM boards in the smartphones so I really hope that it is somewhat possible to increase the amount of RAM on the board.
You can't. Most smart phones are designed as a System-on-Chip; which means that the CPU, RAM, GPU, device controllers, etc are all in a single chip. Updating RAM in such system means replacing a whole lot of other stuffs. Not to mention that you probably would have a hard time finding a chip with different specification which fits perfectly into the hole that was left behind after you dismounted the chip; due to size restrictions, the components around the chip are designed to fit tightly into the available space.