My Live Pen™ 1 indicates memory full, but according to penDirector it hasn't reached 100% memory use. Why is it indicating memory full?

The maximum number of unencrypted physical pages is 500. The maximum number of encrypted session files is 500. When either the limit has been reached, or the pen runs out of memory from a combination of encrypted and unencrypted strokes, the pen shows MMI state Memory 100% full and the strokes from this page are not stored.

In that case there may be available flash memory left that can be used to add more strokes to already used pages in the pen, but no more pages can be stored.