false low disk space reading

Just helping a friend out with his computer. Currently has an 80gb HDD in there which is partitioned into two 40gb sections.

At the moment when downloading things it keeps reporting low disk space on c: drive.

Under properties the C: drive is showing 13gb free and d: has 21gb free.

I have him running AVG at the moment to check it out.

Any ideas if there may be something else giving this false reading?

I can think of a few things, though I'm not sure if anyone of them would definitely cause this.
Check your paging file.
Check your system restore.
How big is the file to be downloaded?

perform a full scan disk on all the partitions; as one of the errors that can occur with file systems is that the free space is wrongly reported in windows. This should solve your problem unless there is something else going on like a viruse.