What files and folders can I remove after I have installed Drupal 7 My installation uses SQLite In order to make the total package as small as possible I have removed unused themes from the root themes directory but what else can I remove? Can I remove modules from te root modules directory that I will not be using e.g. Aggregator, Forums etc?
Yes, you can! But...before removing any modules, follow certain precaution steps first (backup, disable modules).
Please see http://drupal.org/node/250783 on more information on uninstalling modules.
One thing I would also consider is to remove or at least lock http access to all *.txt files in the main D7 installation folder for security purposes.