Hi upgraded to 1.1.3 and ziphoned which I had to do on a PC to work. Previous iTunes 7.6 sync on Mac. When I reconnected to Mac it asked if I wanted to restore backup which I did. I subsequently noticed "Other"=2.4gb on both my Mac and pc which was approx the used capacity pre upgrade. I don't really want to restore as phone unlocked. I think what may have happened is the content of the phone pre-upgrade is now classed as other. I have mobilefinder installed on iPhone and have used Fugu on Mac but don't really know where to look to see if content is duplicated and could be safely deleted. I have searched but can only find the articles where people report 300mb in other- I wish that was all I had :-).
Any ideas ?

try installing a lower version of iTunes ... eg 7.4.1.2 (what i use) and see if it still reports similarly. it is a known bug that iTunes 7.6 incorrectly reports the "Other" memory stored on the iPhone.