Not a dev, of course, but System Volume Information contains system restore points and other nonsense which has very high permissions (Defraggler cannot touch the contents). Defraggler was leaving a very spotty hard drive for me, as well, until I cleared the restore points and shadow copies. It's on the second page of Disk Cleanup. I'm not sure where to find that on XP, but give it a go.
The "Defrag Free Space" is very backwards (or so it seems). It looks like the algorithm looks at the first empty spot, and then finds the first equally sized piece to fit in their. I gather this from the way the yellow and green blocks are placed in the graphic analyzer. I think the following would be much more efficient: look for the first empty location; fill it with the LAST equally sized piece. Consider a row of dominoes in which someone removes the second piece. Instead of taking the third and moving it to the second, and then repeating 1000 times, simply take the last and move it to the second right off. Maybe it already does do this, or there is a setting to allow for exactly that. I apologize if so. It would also be nice if the "Defrag Free Space" preferred to fill holes with fragmented data. This would slightly defragment the drive while also filling up all those holes