Even if timeline is red, which mine often is, it still plays back well for me most of the time. When you export to whatever delivery format, stuff will get rendered then (not to temp files, but to final output).
I just checked and the Preview File Format is I-Frame Only MPEG. I knew it would be big because I was taking a 30 minute 1924x1080 video down to 33% speed with Optical Flow inserting new frames. But 320GB?!