For some reason Windows can’t figure out how to move some files around on disk. When attempting to shrink a volume, it will only allow you to shrink it to where the last immovable file is located. These are some things I found necessary to temporarily get rid of those immovable files so that an NTFS volume could be shrunk
1- Disable System Restore (Right click on Computer => Properties => System Protection => System Restore)
2- Disable Virtual Memory (Right click on Comptuer => Properties => Advanced System Settings => Performance (Settings) => Advanced Tab => Virtual Memory (Change) => No Paging File => Set.
3- Run Disk Cleanup to get rid of Thumbnails, Temporary Internet Files, and a bunch of other files that it makes no sense why they are immovable.
4- Restart the computer to have #1 and #2 take effect
Try to shrink the volume again. If it still is unreasonably large, you will then have to look at Event Viewer to find which file is at the boundary.
1- Right click on Computer => Manage => Event Viewer => Windows Logs => Application.
2- Click on Filter Current Log, and put ‘259’ for the Event ID
3- Click on the latest event and look through the detail to find the problematic file. You can then attempt to delete that file (or set of files) manually. You may have to restart into safe mode to delete some files
It took me about 5 loops of doing the above before I was finally able to shrink my volume to the size that I wanted. After successful, you can then re-enable the features that you want (namely System Restore and Virtual Memory)