Not stupid at all, but the Inc's firmware dev at HTC that created the constraint IS
stupid!!!!
The problem is the data/data folder that you can only see via a rooted app like Root Explorer (dangerous app if not real careful). The data/data folder can not have more than 135mb in it and this also causes the "low on space" error, even though you may have plenty of space left from the 765mb device storage.
I was stuck with almost 400 mb free, but getting the error. I discovered some apps were data hogs and deleted some of them. You do not have to be rooted, since same process:
Go to app manager and look for apps taking up a lot of data. Then decide what you keep or get rid of. Some apps take up more space than the actual app!
I am now able to get to 130mb free. I think that due to the data/data folder constraint, it is impossible to get much beyond that- unless all tip calculators