I have a HTC Droid Incredible.   Menu/Settings/SD & phone storage reports:

SD Card Available Space 7.76GB

Internal storage available sapce:  6.2GB

Phone memory Available space: 551MB.

As you can see, none of these numbers is low.  However I currently have a notification stating:

Low on space

Phone storage space is getting low.

If I ignore this message long enough I'll get a message telling me that I'm out of space every time I try to do something that might take some space.

Telling me to delete some applications will not fix this problem as I have plenty of storage available.  Look at the top of the message again.