The reason you cannot remove users from SharePoint is because users are not stored in SharePoint. Users are stored in the respective membership provider: AD, aspnetsqlmembershipprovider, etc.
The process for removing a user from SharePoint's environment is to first go to your membership provider and delete the user there. After you have done this, you have a choice.
- You can leave the user's artifacts for legacy information. Ie, Joe Blow created a document and even though Joe Blow doesn't exist anymore (hit by bus) it's good to know that he created the document.
- Alternatively, you can run the
stsadm -o deleteuser
command Alex mentioned (once per site collection), which should disassociate that user from all their artifacts for that site collection. Any documents the user created will now be owned by the system administrator (I believe). An example of using this option is when the user account was misspelled and you want to remove all traces before creating the correct account.