Shrinking volumes is a cool feature of Windows Vista, but we’re starting to see an interesting side effect—the inability to create a new partition in the newly created unallocated space. Customers who face this problem almost always have a new computer that shipped from the Original Equipment Manufacturer (OEM) with 4 primary partitions on the disk. As you may know, hard disks configured as basic disks are limited to 4 primary partitions or 3 primary partitions and 1 extended partition and multiple logical drives. Customers who try to shrink their operating system partition find that they can’t create a 5th partition due to this limit. Unfortunately the error message is not helpful and we are working to correct this in SP1.
Deleting the partitions created by the OEM is often not possible due to the way the OEMs configure the partitions. Therefore, our advice to customers is to extend the operating system partition back to the original size to regain use of the unallocated space. If additional storage is needed, consider adding an external USB hard disk.