svchost ("service host") is a "wrapper" executable that provides a home for a number of "services" in XP (and 2K).
Services are sort of like daemons in Unix-like systems, or TSRs in DOS (a much cruder mechanism). They're basically Win32 apps that the system needs running in background to support some of the things you need to do in the foreground. The "shared service process" mechanism allows the system to NOT have to have one process for each service.
Go to a command prompt and type
tasklist /svc
and you'll get a list of the services running in each "wrapper". (You'll also find some services living in the "services" process.) These service names btw are the "internal" names, the names of the "servicename keys" under HKLM\System\CCS\Services in the registry. They are usually obviously related to, but not quite the same as, the more descriptive service names you'll find in the Services applet. If you double-click on the descriptive name in the Services applet the resulting screen will show you the internal name; to go in the other direction, look in the registry.
There are several different "tweak guides" out there that will tell you to shut down unnecessary services "for increased performance"; I haven't been able to measure any such benefit, and it's very easy to hose your system by doing too much of this... but that's another topic. It IS true that shutting down unneeded services can reduce your startup time, and is also good for security in some cases.
Back to the svchost processes...
tasklist /v
will show you the reason for having several of them: They're running under different security IDs.
Don't worry about the memory used (I'm assuming you're looking at "mem usage" in the Processes tab in task manager). First, that memory is not all exclusive to these processes, and second, if a) one of those processes is idle and b) some other process needs more memory than is 'available', the OS will reclaim some memory automatically from idle processes. Conversely, if it isn't idle, something you are doing is clearly using at least one of the services in the process, so you don't want the memory reclaimed...
Really, the numbers you're reporting are usually evidence of nothing worse than a system with plenty of RAM and not much to do -- so the system hands out RAM to processes that need it, and lets them keep it, even if they're not doing much. If the situation changes, XP will clamp down on the idle processes.