Because your using an xbox ;)
Erm are you sure this is the case? Have you tried filling the space after reinstalling MP1? I'm sure it was some kind of installation error or something, Or loss of data?
If it happens again well it's your fault for buying a 360 :P
Im taking there's no OS software installed on the HDD? And when you say it's nearly full, do you mean by the space indicator information or by subtracting the amount shown used on the HDD vs 120GB?








