My friend was telling me that having too many active credit cards on my credit report is not good. I have 16 credit cards (from signing up for them at college fairs, etc) and i only use 2 of them. There's no balances on any of the cards.

Should I go through the hassle of canceling them all? or just let them expire and not activate them when they come in the mail?

You should cancel at least 10 of them. Make sure you keep the best ones (i.e lowest APR and highest credit limits)

Having that many credit cards is just not healthy!