avi file size

Did you render it uncompressed?
Hard drives are very cheap these days so there's no reason not to have a 2 TB. one on your system.
This is in addition to your system drive as you should always have at least two drives on your computer.

You can drag a a still out to make it as long or as short as you want.
If you're referring to the default time, that's found under Options - preferences - editing - still image length.

[doyal gudgel] "But unless changed Vegas will put everything on C drive."

It's always been up to the end user to decide where to put things and I NEVER put anything on my system drive.
When I start a brand new project, I always create a master folder on drive D with several subfolders (for example: music, graphics, project files, captured video, renders, etc.).
Even if a file exists elsewhere on my computer, I make a copy of it for the project as it makes backups a lot easier.