I'm currently running  10 workspaces  on a 1 GHz box and I'm getting some
problems. It won't allow me to create any more workspaces. This box is
used for development so, at most, only about 20-30 users access this
box.

I have not gone over the recommended 15 ws. I believe this was a
general recommendation. Once you got 12-15 ws on a server, the overhead
of maintaining the workspaces  (indexing, serving up content) starts to
consume quite a lot of resources. All of the MS recommendations that I
have seen all state that it all depends on the hardware, amount of
users, how much a user is using the system as well as the amount of
documents in the system. So to answer your question both the amount of
ws (admin overhead) and the amount of users are part of the overall
equations. There is a CapacityPlanning paper in the reskit you should
take a look at. For what it's worth, I have 2 servers in a development
environment that have 12 or so workspaces, a few with greater than
60,000 docs and have no trouble. This is a dev env so there is not a lot
of users and the documents do not change as frequently

I need help and fast too. Does anybody know of any tool that will allow
us to recover a deleted folder in DMS? I know there is a tool to recover
deleted documents.

Sorry, no such animal that I know of except for the backup. I have seen
this question go by in other news groups but all response is that the
Undelete works for files only. If by chance you have a receint backup
then I would suggest restoring to a 2nd server  and moving the
folder/files over. I am sure if any out there knows of anything they
will chime in.

I was afraid you were going to say that. Thanks.

In a test lab I created a bunch (50 if I recall) about two years ago,
just to see if it was able. It was. One of the reasons the 15 limit  is
given is that there are scheduled tasks that run with each workspace
created. The tasks alone can take over the processor as you get more
workspaces. If you split your load to a portal/DM server  and an index
server, you get more breathing room to create more... How much more
depends on the hardware.