"divinity error
unable to write to the installation directory"
Did you try installing it under XP to the partition both ME and XP can access, if it is large enough? Maybe putting it on a FAT32 partition would help, if the problem is due to some conflict with NTFS' features.
"i have directx 8.1b installed in both win xp and me.
i cannot go to directx 9.0 as i have a radeon ati 7500 card (please do not laugh)"
You shouldn't need DirectX 9.
"i must tell you that the drive had to be reimaged before i installed the game the first time so could this be the problem."
Possibly, but the game is not trying to do anything at a low level, so if other applications do not have a problem opening/changing/saving files on the partition, or in the Divinity folder (you could try saving a text file there...), I doubt this would do it.
"if no one can help me i can play the game in win me but i need to know the max size of the save games or if there is a way to tell one save from another so i can transfer it off the drive."
Saved games range from 20MB for a new game to about 70MB at the end. Each save is in a separate folder in the '..\Divine Divinity\Run\savegames' folder, and can individually (or as a group) be moved, deleted, backup or restored.
"and has only 2.7 gigs of room left."
That is lots of room. Old saves can also be zipped to compress them quite a bit, and/or moved to a different partition, etc.
Joliekiller: Windows ME uses FAT32