DLL’s fail to initialize

Ours is a multi-threaded application programmed in VC++ calling VB dll's.
On a Windows 2000 server (Dual Processor & 1GB RAM), about 40 instances of this application run without any problem.
But the moment a few more are created (when the task manager is pulled up, the number of processes are about 120 - 40 by this
application and reaching around 1250 threads in all),
all the applications start throwing errors when creating dll components.
The very first error in each application is "Class not registered"
and the following errors are all "Not enough storage to complete this operation". 
At this point the memory usage is almost 0%; there's lots of RAM and hard disk space available,
so I am unable to understand the reason why "Not enough storage" comes up.
Also, this seems to be closely related with the number of threads and the number of processes
calling CreateDispatch or CreateInstance of the dll component.
On another machine with lesser RAM and storage, a lot more application instances than the number
for which the component creation fails, run without any problem.

What could possibly be the cause?  I am unable to tell if the error is hardware specific,
operating system specific or program specific!