Well, my guess is that whatever software is writing to the drive is making a temp copy of all the files to be written in one place, for some reason. If the temp copy is on your system drive, and exceeds the free space on your system drive, then you run out of room. This is just a (good) guess.
Some things to try:
The next time you burn, take a look in your /temp directory and see if there is a directory there that contains copies of all the files that you are burning. If so, at least we know the cause.
Change your Windows setting for temp directory. I'm on XP right now and you are using 7, I think. Find out how to set Environment Variables (in XP it's My Computer, Properties, Advanced, Environment variables). The variable TEMP is probably set to C:\temp. Create a D:\scratch, and change the value of TEMP to D:\scratch. If this solves the problem, we know that it was writing temp data to TEMP and moving TEMP to a drive with more space solved it.
I kind of have to guess-and-hint without access to the actual machine.