Is there any way of restricting non-administrative users from seeing the rest of the databases in the MS SQL 2000 Server when logged in through Enterprise Manager? It seems a little strange to me that MS SQL would allow you to see the names of other databases that do not belong to you (even though you do not have access to read them)

No !

You could probably write something to give to your customers to prevent them seeing other databases, but it wouldn't stop them from installing EM and seeing them.

And hosting companies allow this? This is a common practice for hosting companies to allow users to see other people's databases?

Not sure about other SQL servers, but that's how MS choose to do it.

Make sure you have no permissions granted to public :-)

You can create another instance. I was told this does not add any more resources. I have actually tested it here at home - created an instance for two databases & it worked flawlessly. Since there were no other DBs under those instances, there was nothing else to see.

You can create upto 16 instances, but from memory, you need a license per instance (you'd need to check this).

However, I can't see many ISP's staying in business only running 16 customer's database per box though. You could potentially VM and run 16 per VM, but this would get very messy after a while.