But you’ll probably find a better answer and input from the RS newsgroup filled with RS experts.

...s.google.com/.../...lic.sqlserver.reportingsvcs

I’d think you’ll do better to put reporting  Services on the sql  box, or to split it out on its own box… but I wouldn’t put it on the SharePoint box. Kinda depends on the load of your SQL box… if it’s not massive (to where you’re having to cluster and such), then I’d just put it on the same one… but I’m sure some DBA will nail my knuckles for that comment.

The answer as always is

It depends

Typically on the amount of data and the number of reports and the commplexity of
those reports

We use the reporting  services web parts for sql  2000 ourselves

We point them at reporting services  running on another server

That server then runs reports against a myriad of database servers (accounts,
crm, support etc)

Ie the web parts functionality is nothing to do with sharepoint  as such it
merely represents the reporting services functionality in the portal if you see
what I mean

So, we provide the reports in the users my site and departmental sites to convey
information like a dashboard to save them from having to go and look for
information

As the report processing is on a separate server the hit on sharepoint is very
low

I know this doesn't really answer your question but hopefully you can see why
the answer is that it depends

For very small implementations you could host the reporting server web site on
your front end web server or on your sql server

If you are going to be generating lots of complex reports then you may want to
host it on a server separate from both of those.

I.e as andrew says, you might want to get sizing recommendations from the
reporting services forum.