There's a number of different ways herbs have traditionally been used. Most are easily prepared at home, and I have made and used most of them. In fact, Debra St. Claire has put out a very good set of video tapes called, "Herbal Preparations and Natural Therapies". She shows how to make different preparations using common kitchen equipment. 

With all preparations, be sure to label them well. Put the date, the strength (ex - 1:2), the mixture (list the herbs), and instructions for taking the preparation on the label.

As always, the following information is for educational purposes only. You are responsible for your own health. Please see a health practitioner if you have any serious health concerns.

Infusion - 
This is often referred to as a "tea". An infusion is used to draw out the most fragile of healing properties of plants. Water is used to extract vitamins, some volatile oils, sugars, enzymes and other proteins, tannins, saponins, glycosides, bitter compounds, polysaccharides (when hot water used), pectins, and some alkaloids. Infusions are most often used with the softer parts of a plant - leaves and flowers. There are a few exceptions, like Goldenseal root and Valerian root. 
Infusions can be done hot or cold. For a cold infusion, place the plant material in the cold water (I prefer steam distilled water) and allow to "steep" for 4 to 8 hours, depending on the herb. This can be done at room temperature or in the fridge. 
For a hot infusion, place 1 tsp. of the dried herb, or 2 tbsp. of the fresh herb in a cup - pour 1 cup of boiling water over the herb - cover and allow to steep for 10 minutes, or until cool enough to drink. These are very general guidelines, and can be adjusted according to need or taste. If you are going to make a pint of infusion, adjust the amount of herb. If you need a stronger infusion, use more herb. 
Somewhere between the two is "sun tea" - prepare the herbs as you would for a hot infusion, but pour room temperature water in the container. Tightly cover the container (a mason jar is great for this) and leave on a sunny window sill or outside in the sun for 4 to 8 hours. This works well. 
Experiment with your favorite herbs and combinations. Herb "teas" can be soothing, refreshing, invigorating, and very healthful. They are the easiest of preparations and are quickly absorbed into your system.
Decoction - 
A decoction is used most often with more woody, resinous material, like roots, bark, seeds and nuts. To make a decoction, use approximately the same amount of herb to water as for an infusion. You can either place the herbs in boiling water (at a very low boil, or simmer) or put the herbs in cold water and bring it up to a boil over low heat. The pot (NEVER use aluminum!) should have a tight fitting lid. Once the water is simmering, cover and allow to simmer for approximately 20 minutes (some herbs need longer). Take off the heat, allow to cool, strain and drink. Or, you can allow the decoction to steep all night, strain and drink in the morning. 
Juice - 
Some plants are best used by juicing the fresh plant. Fresh, spring picked nettles or wheat grass are very nutritious this way. If you have a wheat grass juicer, it can be used with other herbs. A Champion Juicer can be used if you combine the herb with some vegetables, like celery or carrot. Or, you can put the plant material in a blender with some pineapple juice, but there is some oxidation that happens with this method, and you need to strain the liquid before drinking. If you happen to have a hydraulic press, you can also try pressing the plants to get the juice. Any of these methods can be alot of work for a little bit of juice. But, the quality of the nutrients you are getting can be worth it. It's up to you.
Fomentation - 
A fomentation is taking an infusion or decoction (often double or quadruple strength) and dipping some natural material (cotton, wool, silk) in the liquid, wringing out the excess liquid and placing the soaked cloth over the affected area. You can also place a dry towel or cloth over the fomentation to keep it warm as long as possible, and some plastic wrap over that helps keep the liquid from dripping out. (NEVER use an electric heating pad over a wet fomentation!) 
I use this method for Dr. Christopher's glandular formula - 3 parts mullein and 1 part lobelia - made as a strong infusion and used for swollen glands.
Poultice - 
A poultice is the plant material itself placed over an affected area. Usually the herb is bruised or macerated and placed over the injury or affected area, and covered with a bandage. It can be as simple as tearing up and bruising some yarrow leaves, and placing them over a cut, or putting some plantain leaves in your mouth, chewing them until they are a soft mass, and placing that over a bee sting. You can also use something like flax seed to hold the herb in place. Grind up some flax seed, mix in some of the powdered, fresh, or tinctured herb and apply to the the problem area. The ground flax seed makes a sticky mass, and may need nothing to hold it in place. If the flax seeds have been warmed up, this can be a warm poultice.
Oils - 
Extra virgin, cold-pressed olive oil is my oil of choice for making herbal oils. Olive oil takes a long time to go rancid at room temperature, and it is very nutritive in its own right. You can also use cold pressed almond oil, grape seed oil or apricot oil. These are especially good for facial products (considered cosmetic grade oils). Be sure to use the freshest, highest grade of oil. 
You can use dried herbs or fresh herbs in your oil. If you use fresh herbs, make sure there is no excess moisture on the plant material. You can "wilt" the plants (let them dry in a warm place out of direct sunlight) for a few hours to be sure that there is no excess moisture. 
Place your herbs in the container - either a mason jar, or a non-aluminum pan with a tight lid. Pour enough oil to cover the herbs and, in a mason jar, add 2 to 3 inches more of oil, or, in a non-aluminum pot, add another inch of oil. This keeps the herbs from poking out of the oil, and attracting bacteria, which would spoil the oil. 
If you wish to infuse the oil, place a tight lid (for dried herbs) or a clean cloth held on with a rubber band (for fresh herbs) on the jar and put the jar in a sunny window for two weeks. Do this with St. John's Wort blossoms, and watch the oil turn a bright red! 
You can place your mason jar of herbs and oil in the oven as is, or in a pan of water so that the water comes half way up the side of the jar in the oven. Turn the oven onto the lowest heat setting, and leave the jar in there for 1 to 3 hours. The temperature of the oil should never go above 120 degrees Fahrenheit. 
For a faster oil, place the dried, fresh herbs in the top of a double boiler (glass or stainless steel) and cover with oil as instructed above. Cover, and bring the water up to a slow simmer. Keep it there for 30 minutes to 3 hours, depending on how hot the oil gets. As warned above, the oil should never get over 120 degrees Fahrenheit. Around 100 degrees is preferable. Keeping the oil at a lower temperature, longer, gives a better quality of oil. Cool the oil and strain. Store this in a dark bottle in a cool place. It doesn't have to be refrigerated if you used olive oil. 
Ointment/Salve - 
Once you've made the oil as above, making the ointment is fairly easy. For every cup of herbal oil, use 1/4 cup of grated bees wax. Bring your oil back up to temperature (not over 120 degrees) over a double boiler. I like to melt the bees wax separately, because it melts at a higher temperature. Melt the bees wax, and slowly pour it into your heated herbal oil, while stirring. Keep stirring until the liquid is a consistent color, and is clear. 
To test the consistency, put a spoonful of the mixture in the freezer for a few minutes. If it is the hardness you want, then finish the preparation. If it is too soft, add a little more melted bees wax. If it is a little too hard, add a little more heated herbal oil. 
Before cooling the mixture, you may add 8 drops of tincture of Benzoin for every cup of herbal oil you used, as a natural preservative. Take the mixture off the double boiler to cool. Add a few drops (don't go overboard!) of an essential oil for a more pleasant aroma. Keep stirring the mixture until it just starts getting cloudy. This means it is ready to set up. Pour into small glass jars and seal. These can be kept in a cool, dark place, or even in the fridge. They should last for several months. If you start to see signs of spoilage or mold, throw them out. 
Tincture/Liniment - 
Tinctures are an infusion in a menstruum of alcohol, vinegar or glycerin. There are almost as many ways to make tinctures as there are herbalists. Most alcohol tinctures are made with grain alcohol - 80 to 100 proof vodka (this is 40 to 50% alcohol). You can use other things like wine, brandy, etc. to add a different flavor, but those have other ingredients in them. For some herbs, a stronger alcohol needs to be used - in the range of 60 to 90% alcohol. I use Everclear for these herbs. You can adjust the alcohol level by adding some distilled water to the mix, if you don't want 90% alcohol. 
I fill a mason jar 1/2 to 3/4 full with dried or fresh herb material. Then I fill the jar to the top with the alcohol. I put a tight lid on the jar and shake it well. Leave this in a dark place for a minimum of 2 weeks shaking the bottle at least once a day, and preferably 3 times a day or more. Some herbalists leave the tinctures up to 6 weeks. Some start the tinctures at the dark phase of the moon and strain it at the full moon. Try it different ways. 
When you are ready, strain the herbs through several layers of clean, cotton cloth or cheese cloth - I like to use flour sack cloth. Strain it several times, if need be, so there is no sediment. You want a clean tincture, so no bacteria will grow in it. 
Pour the strained tincture into dark bottles and cap tightly. Keep them in a cool, dark place, and they should last for years. 
Dosages of tinctures vary greatly depending on what herbs are used, on the age of the person, and if the health complaint is chronic or acute. It can be anywhere from 15 - 30 drops 3 times a day, to a teaspoon or more every hour. Tinctures can be taken straight. The healing properties will begin being absorbed into the system through the blood vessels in the mouth, especially if you drop the tincture under the tongue. Some people don't wish to take the alcohol, or give it to children, so the tincture can be put into a cup of boiled water. Let it sit until the liquid is cool enough to drink, and most of the alcohol will have dissipated. This is what I do for my boys. 
A vinegar tincture is made the same way using raw, apple cider vinegar. Use the same proportions of herbs to vinegar as in the alcohol tincture, and allow to infuse for 2 to 6 weeks. This makes a good tonic remedy, but it won't be as strong as an alcohol tincture. And you should start checking to see if it is still good after 6 to 8 months. Alot depends on where it is stored. 
A glycerin tincture (a glycerite) is made the same way, using equal parts of pure vegetable glycerin to water, or using 2 parts glycerin to one part water. Make it the same as the alcohol tincture. This will draw out some healing properties from the herbs, but not as much as the alcohol. This is often used for children's formulas because glycerin is sweet. 
Now, liniments are essentially the same as a tincture, but can be made with either rubbing alcohol (PLEASE be sure to mark the bottle for external use only!!!) or vinegar. Liniments are used as antiseptics on minor scrapes and wounds, or as a rub for sour muscles and joints. There are many good recipes for liniments in the better herb books.
Syrup - 
This is a great way to prepare a formula for a child to take - or, for an adult, if the herbs are particularly bad tasting! I have seen a number of different ways of making syrups. Most of the old recipes use sugar... lots of it. My boys aren't supposed to have cane sugar, so I like Rosemary Gladstar's way of making a syrup. 
Start with 2 oz. of dried herb mix to 1 quart of water in a double boiler. Simmer this until you have 1 pint of liquid. Strain and pour the liquid back into the double boiler. For each pint of liquid, add a cup of raw honey. Heat this just enough so that the honey is mixed in with the herb decoction. Don't "cook" the honey. 
When this is ready, take it off the heat to cool. Now, you can add a little fruit brandy (3 to 4 tbsp. per cup of syrup), or a few drops of essential oil, or a fruit concentrate for flavoring. The brandy is relaxing to the throat muscles, but if you are concerned about giving alcohol to children, then go with the essential oil or fruit concentrate. Peppermint, spearmint or wintergreen essential oils are great. 
Pour this into dark bottles, and keep in the refrigerator. They will keep for several weeks to several months. 
I make my own cough syrups, and I can tailor it to the kind of cough a person has.
Powder/capsules - 
This is an easy one... you can buy most herbs already powdered. Or, you can powder them, yourself, using a small coffee grinder (don't use one that has been used to grind coffee, however!). If you grind your own herbs, be sure to sift it to get any larger pieces out before capsulating. You can take the powdered herbs straight, swallowing it down with some herbal tea. However, I don't know of too many herbs that taste good enough for me to want to do this. 
I like to use the Capsule Machine for making my capsules. For years I did it one capsule at a time. Then I found the Cap-M-Quick machine machine where you load the bottoms of 50 capsules (the large end) in the machine to fill at one time, but you had to place each top part on each capsule. Then I found the Capsule Machine... The bottom of the capsules go in the thicker side of the contraption, and the top of the capsules go in the shallower side. You fill the bottoms, partially fill the tops, squeeze the two parts together, pull them apart, and you have 24 capsules filled and ready to take in about 2 minutes. Very nice! 
Now, you can use the gelatin capsules, or, if you are vegetarian, you can get plant-based capsules. Why take capsules? Well, it takes longer for the herbs to get into your system with capsules, but you aren't losing any of the herb, either. If you want to use the whole plant, capsules is the way to go. Take the capsules with warm, herbal tea. (Be careful with cayenne capsules, however - they can start to disintegrate in the throat, and you will feel the heat!)
Pills/Lozenge/Suppository- 
These are all made in similar ways - powdered herbs are added to a liquid until a stiff dough is formed. Then the mixture is shaped as needed. 
For pills or lozenges, powdered herbs (usually for the throat or for a cough) are mixed with water and honey to make a paste. To this, add a few drops of an essential oil, like peppermint or wintergreen. Thicken the mixture with enough Slippery elm, comfrey root, or marshmallow root powder to make the mixture's consistency like dough. Pinch off enough to make a small pill or a larger lozenge. Roll it into a ball and press between your fingers to flatten (they dry through faster in this shape, but you can leave them as balls). Then cover it with a little more Slippery elm powder or some carob powder. Place these pills/lozenges in a very low oven, in a dryer set on low, or in the sun for a day. Once they are dry, they will keep for a long time. 
A suppository is similar, but the powdered herbs are mixed into melted cocoa butter. Cocoa butter is a hard fat at room temperature, but it melts at body temperature. This is a very good way to get herbs directly into the vagina, the rectum, or even in the nasal passages. Use about 1/2 oz. of powdered herbs to 3/4 to 1 oz. of melted cocoa butter. Stir until the mixture starts to thicken. Form the mixture into small cylinders, about 1/4" by 1" for the rectum or vagina. Put these on a plate and cover with a paper towel. When they are hardened, they can be used. Usually the suppository is placed in the vaginal or rectal area just before going to bed, and it is wise to wear a pad in case any of the melted cocoa butter runs out. 
For the nasal passages, form them into 1/8" by 1/4 to 1/2" cylinders. Harden them the same way. Place the suppository up into the nose. Prepare for running and sneezing as the cocoa butter melts and the herbs start to work.