I've got a pile of demo VMs that Stuart and I and others work on and once they're all setup they tend to get pretty big. After some work recently an 8 gig VM ballooned to nearly 10 gig! There's all sorts of tips and tricks on how to compact VMs, usually by defragging and zero'ing out free space. However, I don't have the time to do this kind of stuff manually, and when I DO run through these processes manually I'm rarely satisfied with the results.
Invirtus VM Optimizer is a clever little tool that solved this particular problem. It's an ISO image that you mount within your guest OS. I used the "Automatic Corporate" edition. It autoruns on mount and I waited for about 20 minutes. After it was done, I ran the Virtual Disk Wizard that comes with Microsoft Virtual PC (Invirtus works on VMWare also) and compacted the 9.9 gig VM down to 3.4 gigs in another 10 minutes.
So, a total of 30 minutes later I had a VM that was 1/3 the size, ran faster and now fits on a single-layer DVD when the original one wouldn't have fit on even a dual-layer one.
Full disclosure: The first Microsoft Virtual Disk Wizard compact operation failed with an obscure error message. I ran chkdsk on both the host and guest OSes, and ran again and everything worked fine. I don't think this had anything do to with Invirtus.
Here's what I can say about Invirtus VM Optimizer - It did exactly what Invirtus said it would do! Always nice to have software work EXACTLY as advertised. Frankly, I would have been thrilled with a 50% size reduction, and was VERY surprised to get 66% as a bonus. I use VMs all the time and the price is a no brainer, US$40 for personal and US$160 for Corporate. Paid for itself in one use.