Server Out Of Memory – There is no memory on the server to run your program. Please contact your administrator with this problem. at Microsoft.SharePoint.Library.SPRequestInternalClass.ApplyWebTemplate(String bstrUrl, String& bstrWebTemplate, Int32& plWebTemplateId)

There are lots of reasons this error message can occur, see: http://www.google.com/search?q=sharepoint+Server+Out+Of+Memory. In my case it happened when a new site was being provisioned using a custom site definition during the ApplyWebTemplate call.

Turned out the there were subtle errors in my onet.xml. In particular I was referencing some document templates using an incorrect path:

<Project Title="$Resources:onet_TeamWebSite;" xmlns="http://schemas.microsoft.com/sharepoint/"  Revision="2" ListDir="$Resources:core,lists_Folder;" xmlns:ows="Microsoft SharePoint">
  ...
  <DocumentTemplates>
    <DocumentTemplate Path="INCORRECTPATH" Name="" 
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