The Samsung Z500 definitely works with the 256MB Kingmax micro-SD, and i am sure with the 256MB Transflash as well..

There wouldn;t be a lot of point putting in the complication of a memory card slot if it was not going to enable it to use bigger capacities than it is normal to find in the phone internal memory.

Quite often mobile phone manufacturers claim their phones will only work up to a certain size of memory card, but proves not to be the case; this has been proven often with Nokia as well.

Cheers