We have seen this message twice since we migrated to SCOM 2007 R2 (From SP1):
XML document could not be created because server memory is low. Use sp_xml_removedocument to release XML documents.
From what we understand some stored proc is not releasing memory properly. Every time this happens we have to restart the SQL instance that hosts the operations manager databases to release the memory.
I opened a CSS call but MS did not help. The Microsost SCOM support tech said it was a SQL problem and the SQL support tech (also from Microsoft) sent me the documentation for the SQL memory architecture !!! (not at all usefull).
I'd like to know if anyone has seen this problem with R2. Right now I'm not sure if the problem is from SCOM stored procs using and not releasing the memory or from the SQL server not having enough resources.
Thanks for any input on this one.