If you go for even bigger permgen (512) it should work, but will die eventually after you re-deploy the app a few times.
The way I 'fixed' this was to change to jrockit, which does not have this problem.
I use (in Eclipse) the VM arguments for starting JBoss
-Xms512m -Xmx1024m -XX:PermSize=256m -XX:MaxPermSize=512m.
It seems to better.