"Windows Side by Side". It's a part of the move to a "component" based architecture, where the WinSxS folder contains multiple versions of a component such as Windows Media Player or IIS, and the appropriate versions are hard-linked into the system. Unfortunately, Windows is stupid (surprise!), and provides no easy way to remove old versions. While it's understandable that users might want to uninstall updates for one reason or another, after the initial install it becomes pretty unlikely.

Now that Vista SP1 is out, there is a tool which will remove all of the RTM versions of updated components. Unless you plan on uninstalling SP1, there is no reason to keep these components around.

Cleaning out the directory is pretty simple. Click the start menu, and in the search field type vsp1cln. A single result should show up. I have UAC disabled on my system, so if it's an issue run cmd first, and run the utility through that.

I started with a WinSxS folder of 10.9 GB. After running the cleaning tool, it dropped to 8.48 GB - nearly 2.5 GB! While this doesn't matter so much on desktops, it could make a big difference in virtual machines, or on laptops.

It's too bad that there isn't a nice way to do this from a GUI. Hopefully SP2 will include one.