There is no onboard RAM - there's just one socket.  If you have a 1G module now, you must replace it with a 2G module.

No, the Intel Atom CPU in this system is incapable of addressing more than 2G of RAM (and the CPU is soldered, so it's not upgradeble).

The single memory module is here:

http://support.dell.com/support/edocs/systems/ins1012/en/sm/memory.htm#wp1180190