When you try to install Visual Studio 2008 SP1 you will notice that you will need a lot of free space on your system drive. Unfortunately this was not the case with my SharePoint development VPC. Luckily it is possible to extend your existing C-disk.
- Download VHD Resizer from vmtoolkit.com
- Next boot up your VPC with the newly resized disk as a secondary disk (This is important since you can't resize a system or boot volume) - and use Diskpart
- Go to command prompt
- Type diskpart
- Type list volume
- Type select volume [Your Volume Number]
- Type extend
- Save your VPC and change the settings of your Virtual PC image to use the resized disk as boot volume.