There IS compression. There has to be. Let's say 3:1 compression on textures (totally random). If you need 60MB of textures in a level/scene, it will take 3x longer to load that texture into memory before it's worked on. I seriously, SERIOUSLY doubt they're going with little compression.
AFAIK, game data is streamed off the disc (BR or HDD) into memory first, THEN the CPU/GPU grabs data and operates on it. To minimize the memory footprint, YOU HAVE TO USE COMPRESSION. BR won't make 512Mb magically more. So if there's 21GB of data there, you can expect that it's either laregely redundant data, or *gasp* Insomniac went sickhouse on the large pool of space they now have.
I wasn't aware that art creation was the only cost involved, but also optimization. Maybe BR means they have to optimize less to keep texture sizes down. And with the HDD offering a dynamic(?) swap file, you can no doubt stream data from both drives at once. Maybe BR filliing the swap file seamlessly while the HDD pushes data out to main memory. L1/LS -> L2 -> XDR/GDDR3 -> HDD -> BR? Random thoughts. Props to guys like Cliffy who have to read this drivel and restrain themselves from bitchslapping everyone spewing nonsense. PEACE.