vOptimizer crushes a Virtual Machine's disk size by 20-60% and can increase performance dramatically - they have a freeware version now, but it's hard to find on their website...
I was able to take a minimally prepared XP SP2 VMWare virtual machine from 1.1 GB to 780MB and vOptimizer Freeware was FAST - did it in about 15 minutes. I had already taken pains to ensure I did not unnecessarily ballon the virtual disk (like running SP2 from uncompressed source from an ISO image. The new version runs OUTSIDE of the vm and operates directly on the disk files.
The information on the freeware version is not easy to find on Vizioncore's website and did not come up on the web searches I did. The download is also not provided at their site - but on the traditional freeware sites. The link below takes you to the page that compares the freeware version with their other versions.
Source : desktopengineer.com