they use several for 1 world in most cases. i know that in dark age of camelot, they had a cluster of 5 (i think it was anyway) dual xeon servers, each making up 1 game server. i'd expect most mmorpgs work the same.
as has already been said though, they handle such a large amount even on 1 server, because there's no physics, no collision detection, no fast paced action, it's really not much more than database lookups on the server side, and co-ordinate tracking, if you strip it down to it's basics.
meanwhile an fps game also has collision detection, physics, tracking location of particles and projectiles from weapon fire, and a lot quicker response is needed aswell.