Hello. Mort81...This proceedure should also work (and take less time) if quality is not an over-riding issue. Once you have the menu's and extras at the lowest compression, change the main movie to CUSTOM also. Then back off the 4464 MB on the green bar to 4430 ... or even 4400 if that doesn't work. You won't lose that much in quality. The "not enough space" tends to be more of a drive issue. Also, make sure you have the latest firmware upgrade, as this sometimes solves this problem... I am always doing that which I can not do, in order that I may learn how to do it. (Pablo Picasso)