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I have the following assumptions about .NET webservices which I need
confirmation/denial of:

1 - They are only instantiated when required & then a different
instance for each request.

2 - If someone making a request causes an unhandled exception then
their instance will die but it won't effect anyone else making
requests.

If someone knows either of those are wrong or a good source
information regarding those assumptions I'd really appreciate it.

> 1 - They are only instantiated when required & then a different
> instance for each request.

Yes, they are classes (just as ASP.NET web pages are) and so they are
instantiated upon request (each request).

> 2 - If someone making a request causes an unhandled exception then
> their instance will die but it won't effect anyone else making
> requests.

Well, the instance doesn't "die", as you put it. Instances stay in memory
until removed by the .NET Framework "Garbage Collector". The "Common
Language Runtime" of the .NET Framework is where code is processed and it is
where the exception will be created. You are correct though that this will
not affect the CLR's ability to handle other requests.