now that you have added that wee gem of info, I'd reccommend a reload of xp as the fastest way to getting back to a usable computer. dealing with problems of svchost, is difficult, painfull and very time consuming. There is a fast amount of info on the internet, about svchost, most of it confusing,.
Of course if you can get back to the original config of 180MB and it all works, it might suggest problems with the memory controller ( which is on the Mother board) You might do a google for memtest which is a wonderful utility which will check memory from a floppy ( doesnt even load xp etc) however you do need a bootable floppy on your laptop ( i think you can make a bootable cd which will do the same)
Good luck
Rickity