I have the same problem only much much worse. I tried installing
the latest Beta version of Windows Live writer and just like la_bruin it jumps
to 50% then 100% then gives me the error 0x80004005. Only in my case it used
about 5Gb of hard drive space which was all the space I had left on the drive.
So foolishly thinking
that perhaps it just needed a bit more space, I cleared some stuff off my drive
and managed to free up about 3 more gigs. Then when I tried again, it once more
completely filled my hard drive, and then it gave me the error message again. I
have been searching for any unusually large files on my drive but have had no
luck. So now my question is, how do I clear the nearly 8Gbs of hard drive space that Windows Live Writer
stole?