I had a similar problem to this many years ago and loss of hd space was caused by 2 things. My defrag was not actually taking the long time i though it was. It could not get going properly because it got stuck in a mini loop.This in turn caused system restore to keep setting a restore point and as you know every restore point takes a chunk of your hd space. I had no idea this was happening until i got a short of memory report.
You have 2 options , set a new restore point and delete all others if this does not get your memory back i think the only option would be to do a full system reboot to factory settings. Save all the data such as docs,pics and other irems for later use. You probably dont want to do a full reset but i think you might not have an option.