Hi
A system has many run levels. The default being the initdefault defined in /etc/inittab. (usually 3)
A run level is a system state in which specific processes are allowed to run. The predefined run levels shipped with your system are 0,1,2,3,4,s and S.
The directories rc*.d are the run level directories for each of the processes that the machine is allowed to start when going to that run level.
The S*** and K*** are startup and their corresponding shutdown scripts. For example, the S*** number represents the order in which the machine will start the process when the machine boots, but the scripts should also stop in the correct order. So a startup script named S700 for example will have a corresponding shutdown script (1000-700= K300).
Clare