Lets sum it again:

I try to copy the I386 folder from the CD to a folder on a hard disk

I do it from "CMD-xcopy h:\I386 (cd) i:\i386 (usb hardisk) /s"

Te original folder on the CD is 500mb but the folder on the disk is 800mb

The folder on the disk was emptybefore copying

All that before using Nlite

You're not doing it right, man, read again:

You need to copy all files from your install cd including i386 subfolder to an empty folder.

What you're doing now is copy i386 folder to the root of your disk. That's why nLite reports all the content of your disk because the root contains the i386 subfolder.

mzik, you said you added SP3. Is the 800 MB before or after adding SP3? How did you add SP3? Did you really only copy the I386 folder? Please post a screen shot of a Windows Explorer view of your hard drive. How is your hard drive formated - NTFS of FAT? What kind of hard drive is it (besides USB)? Enjoy, John.

You're not doing it right, man, read again:

You need to copy all files from your install cd including i386 subfolder to an empty folder.

What you're doing now is copy i386 folder to the root of your disk. That's why nLite reports all the content of your disk because the root contains the i386 subfolder.

Sorry, its not about Nlite

Its about copying /I386 from the CD to a folder on a hard disk, befor using Nlite

You only tell us "the folder on the disk is 800mb" and "the file arrives to the folder as 800mb" but we still don't know what reports that. You can of course continue your own way and get no further.

nLite or not, you posted here, so if you want to solve you problem, follow the advice already given twice; take your original XP disk and let nLite do the copy. The way you're doing it right now, beside the fact you see(?) 800 Meg in your i386 folder, is not going to work anyway. nLite is going to include Recycle Bin from your USB drive and other stuffs in your new cd.