I haven't done it myself but heres a summary of what I've read on this forum and other sites.
The mobo has place for 8X16MB memorychips, but only makes use of 4 of them in the original setting. The other 4 memory locations is empty. By adding 4 chips one can double the RAM on the Xbox.
There are a few ways to get hold of these chips.Sofar I've seen one german and one american site that sells new chips. Last I checked with the german site they where sold out and didn't plan on getting new ones. I don't remeber the names off the sites.
So thats
1. Buy from a reseller.
Number two is to order them from the manufacturer but as I understand it they only take orders with atleast 500 chips.
2. Start a major coopbuy and order 500 chips. (I would be real interested.)
A few people have bought dead Xbox mobos and desoldered the chips from those. That seams quite tough to do but on the other and it may be the cheapest thing to do.
3. Reuse chips from a broken mobo.
Finaly I read somewere that some Gf graphiccards (Was it Gf4 something) used the same memorychips.
4. Desolder and reuse from one or several old graphics cards.
However, the benefits from this mod can be discussed. There would be no perforance gain when playing games developed for the Xbox. These games are made to use only 64MB and will not even recognize the extra memory. If you plan on running Linux or maybe a CS server or something then you could get a performance gain with the extra memory. I guess that when decoding movies and other stuff thie extra memory also ould come in handy.
This is what I've read. Nothing is of own experience and if I've gotten anything wrong then feel free to update my knowledge on that point.
I personally wouldn't do it because of the performance gain, but simpli because it can be done and that it wasn't M$ intention from the beginning.