We have a similar issue with OneDDL, as the amount of posts mean the sitemap takes about two minutes to build and consumes 130mb ram in the process.
The way we got around that was to stop it regenerating on every post update and we just have a cron job that runs every hour to update it. Its not perfect, but it does the job.
I have heard about the beta version, but haven't yet built up the courage to try it, maybe I should. :p