I did a profile of my Grails application with JVisualVM running Grails 1.3.4 and then again running Grails 1.3.5. What a difference! The memory leak issue that was referred to here http://jira.codehaus.org/browse/GRAILS-6622 was fixed in the 1.3.5 release. I believe that a similar memory leak was affecting my application as well. Across the board, the application is faster and has a much smaller memory footprint. I have attached a snapshot of the memory comparison for the two versions to this post.
|Memory Comparison of Grails 1.3.4 and Grails 1.3.5|