Like many of the others, I was experiencing the "Installation error: insufficient storage available" when trying to download applications from the marketplace. I was able to fix it by deleting the data.img and letting it rebuild it. If it means anything after deleting the data.img I launched the MHGDroidUtil with Force CDMA flag toggled. When setting up my google account it went a little strange -- it kept looping between the screen asking me to sign up or sign in after fully completing the sign in option before it. A simple soft-restart seemed to fix the looping there.
This was also done on the 'naked' version of the AIO 5/11. I tried doing the folder merge but that didnt work.
All and all, just letting it rebuild the data.img seems to be the fix for this error.
