http://www.vlite.net/download.html
changelog
My isos are under 650mb now
changelog
v0.95 beta
* new: Automatic registry defragmentation
* new: Setup memory requirement tweak (32bit)
* new: Image splitting support
* new: 'Paint'
* new: 'Desktop Window Manager'
* new: 'Application Experience'
* new: 'Windows Media Player'
* new: 'Windows Media Codecs'
* new: 'Wordpad'
* new: 'Sound Recorder'
* new: 'System Information'
* new: 'Internet Small Computer System Interface (iSCSI)'
* upd: 'Snipping Tool' separated from the Tablet PC
* upd: 'Remote Desktop Client' separated from the Remote Desktop
* upd: Printers separated
* fix: ISO booting (BCD 0xc000000f Error)
* rem: 'Component Cache' removed
My isos are under 650mb now