if i were you, i would spend about $100 on an 80gig hard drive, for more games, movies, mp3's, ect. 20gb is enough to run an OS, but how many games you plan on installing?
i think what is suggested for the installation of sp2 is 3gb of free space because it has a bloated install. i dunno wat the hell it does during the install it makes a lot of temp files or something