"Instancing" would mean that the software stores the data relating to an object only once ... and then keeps track of the number of times the same object is used in the scene.

It's a good idea if you want to use a lot of the same content in a scene, but doesn't address conserving memory if you have a 100,000 polygon character that's wearing 300,000 polygons worth of high resolution clothing, fighting a different character with an entirely different set of clothing that is 300,000 polygons.

In the long run, subd would be a better solution than instancing, IMHO.  Both would be even nicer. LOL