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An update of sorts to this old issue as my Steam memory usage started to creep up again recently.
It turns out I had the worst option enabled in Steam without realising it.
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As someone with more than 3,000 games on Steam who regularly has between 100 and 200 games installed at any one time, it seems that Steam was literally storing what in-game browser tabs I had open for every single one of those games, even the ones I had uninstalled. And that can take upto 4GB of RAM apparently as Chromium has dictated that it should have all those tabs stored in the memory just on the off chance that I wanted to play one of those games.
Since toggling that option off, my Steam RAM usage floats around 700 to 750MB although it does go above 1GB when downloading/installing new games, before settling back down to the 700 to 750 range. I'm more than happy with that!
sounds like a pointless option for steam to have tbf