2 Bunny, check out this link below for tips on reclaiming your Diamond's main storage memory. ClearTemp is attached to one of my posts there, and it should help if you make sure to add specific folders for it to clean.
http://forum.ppcgeeks.com/showthread...ght=low+memory
As far as cooking your own ROM, I'd recommend starting with OMJ's Kitchen, and make sure to study his tips and guidance on the first page. If you use one of his .erv files, you can add and remove specific programs and other items in order to customize the ROM to your preferences.
http://forum.ppcgeeks.com/showthread.php?t=97388
Hope this helps...
R