Story of Compiling Kernel for Linux VServer

So I've been having a fun week.

This is my first time compiling a kernel and It should be straight forward as there are some helpful websites available on just this topic:

pre-requisites:
Patience. This will take an hour (or more) on a decent quad core machine.
gcc-<version>-plugin-dev
fakeroot
make-kpkg
libncurses5-dev

On compiling the kernel with the VServer patch
http://linux-vserver.org/Installation_on_Linux_2.6
On compiling a general kernel
http://www.howtoforge.com/kernel_compilation_ubuntu
On using your complete kernel
http://www.centos.org/docs/2/rhl-cg-en-7.2/buildkernel-bootloader.html

I was running the commands on a Ubuntu12.04 virtualbox machine, following the Vserver instructions and while running make, it kept running out of disk space.
A quick google tells me the result should be about 500MB at most, and doesn't even tell you what the result should be. My attempts kept running out of space after about 40 minutes and after hitting 8GB used space, of which almost all the room was taken up by vmlinux (2.9GB) and vmlinux.o (4.9GB)
Apparently this is not normal.
Eventually after making a virtual hd with a size of 100GB (of which the result was just short of 9GB itself) it appeared to say a build of bzimage in /arch/boot/x86 folder was completed. This I could never find anywhere in the folder.

I am currently compiling using the howtoforge.com link so we will see how much success I shall have later on.
Currently I am getting GCC error "array subscript is above array bounds" quite a lot but it appears to be ignoring it.

#Edit
Its been 2 hours. I didn't set CONCURENCY_LEVEL= because of fear of it crashing. Starting to wonder if it was a mistake given how long this is taking. It is still compiling and it has just moved from ./drivers to ./fs. My favourite file list, sudo du --max-depth=1 -h | sort -rh , reports file is at 7.9GB and growing.


7.9G .
4.8G ./drivers
689M ./net
602M ./fs
316M ./arch
259M ./sound
126M ./kernel
76M ./security
58M ./crypto
41M ./mm
34M ./lib
31M ./include
19M ./Documentation
17M ./block
13M ./.tmp_versions
6.8M ./firmware
6.2M ./ipc
5.0M ./grsecurity
4.7M ./init
4.1M ./tools
3.8M ./scripts
2.8M ./virt
2.0M ./debian
156K ./samples
92K ./usr