ok for a while now microsoft update has been installing updates every night on my computer.
it is putting folders in my c drive with numbered names like
0b9e866e15dcf46ebc7b8b7
and inside it has a text document with a name like
msxml4-KB92798-enu
now im only conserened because i have 26 of these folders and files different names but similar
any idea as to waht they are?

They are the rollback files for the updates installed. They are harmless and are put in place as a safety precaution in case any of the updates installed ever install incorrectly, become corrupted, or to have on hand if the computer is rolled back to a restore date.

good i thought i was being infested with viruses. is it ok if i move all of them to a specific folder so its not so cluttered or will it mess things up?

i would advise not to move them. they are part of the windows OS files. if and if ever windows needs to roll them back it might not be able to find them or roll back successfully.

Leave them be

We all get them.Thats why it pays to have a large hard drive so these won't
matter.Try to have 25 % free space for XP.
Run Disk Cleanup regularly,Its safe to delete what it finds.