N97 out of memory errors

The product is N97, you don’t have in you drop down list!!!
I have had my n97 for about 10 days now and everything was going brilliant. It is a stunning piece of kit.
However on day 11. I repowered the n97, it kept on hanging the eventually got to boot after 20 attempts, but it was useless could not look up contacts. So I had taskman installed and killed loads of processes and uninstalled all the apps. It became usable as a very basic phone, but sluggish. Could use browser, maps, photos.
The problem is I keep on experiencing out of memory errors on the phone, when I try to do basic things. I don’t know how to resolve this. I have rebooted, reset the phone to factory settings.
Deleted data, uninstalled more apps and still no joy!! I cannot connect to ovi/pc suite to up grade the phone or roll it back.
Symptoms the phone is sluggish it is still virtually unusable. It just barely make phones and is slow to respond to touch-screen presses and key presses.
The taskman app says the is 47 mb free on C: drive. So I cant see what the problem is!!!
I have always bought nokia for 10 years, never experience this sort of thing before.  I am really disappointed with this.
Anybody else experienced this? Any ideas?
Many thanks
Gd
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Copyless thanks for the tip.  Kudos added :-)
I had the same problem a friend was trying to bluetooth some videos to me and I was getting Memory problem, How embarasing after a few min of my mates being impressed with the phone, and me praising it and talking about so much space and blah blah blah.
I could not receive videos via bluetooth because they were 5MB.  WHY on EARTH can they not default this to the E: drive.
Whoever made that decision in NOKIA should be fired what an idiot.
Also  when I finally got to get the pictures on the phone via a computer I could not see them via the "Photos"  I had to go via the File Manager and see one by one.  AARRRRRRRRGHHH  I am getting to the point that I am going to return this phone.
N97 Black unlocked using the 3 Network (UK). Product Code 0586308. Firmware V20.0.019. Made In Finland.Custom version V20.019.235.10.