Of course few tens of megabytes should be processed okay.
I used to operate this way Archive::Zip object of size 35Mb, which was done for archive some 400Mbytes, in order to save archive creation time -- without any problems.
You didn't provided many detailed version information, so I guess on what I saw in your post.
As long as you mentioned "cygnus" I assume this cygwin is rather old, and it could be that its default mounts are text (as opposed to binary), so this could lead to broken numbers and thus huge memory allocations.
As for memory profiling - I use very primitive but quite handy way to see for memory consumptions. near 1Gb -- just ordinary task manager shows eaten memory just fine.
Otherwise Devel::Peek for precise analyzis, but this requires some programming.
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