One execution of it ran Java 7u21 - which is outdated - suffered from the mentioned _JAVA_OPTIONS issue
[B#439] 2014/09/05 19:27:59 [INFO] 2014-09-05 19:27:59 [INFO] [ForgeModLoader] Java is Java HotSpot(TM) 64-Bit Server VM, version 1.7.0_21, running on Windows 7:amd64:6.1, installed at C:Program FilesJavajre7
Another one ran Java 8u20, which has a known issue with it and is what you're hitting with Java 8u20.
The issue, related to _JAVA_OPTIONS, thats overwriting the ram assigned via launcher - which btw is recognizing that you have that amount of RAM. And to fix this:
Click start
Enter "environment"
Click "edit environment variables for your account"
Remove "_JAVA_OPTIONS" from top and bottom lists. A reboot may be necessary.
Initial heap size set to a larger value than the maximum heap size
That, as you mentioned in your first post is a direct result of the -Xmx512M issue btw. -Xms being greater than -Xmx causes this error to be thrown, because you cannot start with 2G of ram but limit max RAM to 1G, for example (and hopefully obviously apparent)
[B#301] Picked up _JAVA_OPTIONS: -Xmx256M
Maybe try to remove the environment variable that's forcing only 256MB ram on all java apps and then try to run the modpack.
post the log
logs can be found when clicking the Cog-Wheel button on the top right corner on the launcher window. If you can't open the launcher the logs can also be found inside %appdata% -> Roaming -> .technic -> logs
Paste the content on pastebin.com or paste.ubuntu.com and give the link.