I put something like 20 discs worth of songs on mine and the "free blocks" never did drop below the original number (50,000+ or something like that). I also have a lot of really big saves on there, tons of KotOR and KotOR 2 saves, which were very large for the day. I really don't know how, in general usage, you would ever fill the thing, even if only 8gigs were available.
If you're modding, though, it's probably best to just ftp over MP3s and play them in XBMC or something. Way less annoying than ripping disc after disc. Only reason to rip is if you need them for a game with support for custom soundtracks.