When defrag is finished, I would move My Documents, My Pictures, and maybe some other folders from C:\ to D:\. To move My Documents, right click on My Documents, select Properties, select the Location tab, and then click the Move button. Select D:\ and let Windows move My Documents to D:\. If My Pictures, My Music, etc. are under My Documents, they will also be moved. If they are not under My Documents, the same technique can be used to move them.
Another way to free up space on C would be to uninstall programs and resintall them on D. Of course, you need to software CD or installation file on your hard drive if downloaded from Internet.
You still have MS Office installed, right?