Back in the day, when we would get this message on our Droid 1, we would delete the ".android.secure" file. The file is on the sdcard-ext and don't worry about deleting it as the OS will rewrite it immediately.
Baton Rouge, LA
Just keep trying would be my advice. I believe that sometimes the Bionic has a bit of a memory management problem with which results in that message. Backing out and getting back end usually works when I experience that problem.
I am also having this problem. When I try to download/install certain apps (Most apps) it will come up with an error message saying "Error downloading (Whatever app) . There is insufficient space on the device. I try to download it multiple times, and it never works. Sometimes it will let me download things, and sometimes it won't. Most times, it won't. I had it for about a day before it started doing that, probably less. I tried freeing up some space by deleting things even though I already had enough space to begin with, and it didn't work. I also tried to go into task manager and remove some unused apps and such. Also didn't work. Should I send it back and get another one? Get a new SD card? Someone please help me.