Here's some data recorded from my installation of skyrim with the skyrim performance monitor.

First with a bunch (15 or so) Mods loaded, not any fancy HiRes Texture Megaoverhauls, just character and clothing/armor replacements: http://i48.tinypic.com/3091zrn.jpg

As you can see, Vram peaked just half a minute in to the game, and the game crashed in less than five minutes.

Now here's a recording of running around Whiterun with all the mods and plugins disabled (not a completely fresh install, but essentially vanilla): http://i50.tinypic.com/2mc8rvo.jpg

Although the game did not crash in the 10 minutes of recording Vram was already running really high, the highest point being 975MB out of 1024MB.

This was recorded on the default settings automatically set by skyrim, being High in this case. They aren't optimal of course, but still, shouldn't this rig be well capable of running Skyrim on high settings? The amount of Vram consumed on a plain vanilla installation is just ridiculous.

And now to the big question, is there any way I can run even a handful of small modest mods without decreasing the video settings to minimum (if even then)?

EDIT: Actually, texture quality was set to medium instead of high.

Revert completely to a vanilla game (INI files included) and see if it works.