I like to use split disks with my Parallels virtual machines, since it makes backing up the drive image a lot faster and easier. It seems that Parallels Compressor isn’t able to properly compact a split disk, though.
Today I decided to run Compressor since my Windows XP virtual disk was over 15 GB, even though it had less than 6GB used. After running compressor, the file ballooned to 19GB! I converted the drive back to a single file and it’s now down to 6GB.