I keep my file "My Documents" in the desktop, but it is overloaded, almost 2GB. I known my RAM is is just 520MB.
Can I store part of my documents in drive C? Can I create folders like I do in My Documents?
Can I store there also My Pictures?
I have 120GB Hard drive, so I have a lot of room in Drive C, but so far I never thought about it till I started to get problem when opening files. I usually get the window saying "there is no space for opening or something like that"
Thanks.

Anything that is on your desktop is in the C drive by default. The My Documents on your desktop is probably just a shortcut to the folder where My Documents is stored, depending on what operating system you have. For example, with Windows XP, it's usually C:\Documents and Settings\(your user name)\(User name)'s Documents\. You can also find a folder for Desktop, and start menu, and lots of other fun things.