How much ram is being used on my laptop?

Hopefully you have just booted or not worked much yet. A ubuntu system should make use of all the ram. Both are correct. The lower is how much actually used for applications and free includes cache.

Cache is data read from your hard drive in ram. The second you need ram some of the cache will be sacrificed, but if you were to access files on your system that are in cache, the system will use that instead of slow disk access so that your machine works faster and consumes less power.

The output of free -m on my system:

             total       used       free     shared    buffers     cached
Mem:          1763       1634        129          0         15        483
-/+ buffers/cache:       1135        627
Swap:         1019        675        343

A healthy system with minimum free memory. Notice the second line -/+ buffers/cache. I'm really using 1135MB for applications and 627MB is free if I need, since the kernel can kick some of the oldest used cache easily. Since it's not as much as my home computer it does use swap as well because cache is more valuable than memory seldom accessed. The kernel is really good at utilizing your computer resources so that you get most out of it.

Open the terminal (or press Ctrl + Alt + T) and type top to see the real memory usage. Alternatively you can use System Monitor to see memory usage.