Is not having LLE Modules the reason why most games freeze?

Considering what you just said, Loading certain modules crashes, but then when you load the complete module set from "Dev_Flash" it loads, but then runs out of memory to play (Obviously, it just loaded the entirety of dev flash modules to memory and filled the 256mb with modules)

You can place whichever modules you want in the dev_flash/sys/external folder, it only loads up the ones you select in the LLE Modules window.

Plus, I don't think that's how the memory works in terms of LLE functions... I don't know how it works, though I'd guess the modules aren't loaded in those 256MB of RAM the PS3 originally has.
Also, I don't think there is a game that needs all the modules that are present in the PS3 firmware.