System files take up 160 GB fo 256 GB drive and the system drinds to a halt

Manage Storage

Apple’s final word on managing the “System Data” category:

System Data: Contains files not listed here. It includes system files like log files, caches, VM files, and runtime resources. Temporary files, fonts, app support files, and plug-ins are also included.

macOS manages them, and the size varies based on your Mac’s state.

Users have control over the User Account Folder (Home Folder). All other areas are inaccessible.

It’s good computer practice to keep at least 20% to 25% of the total drive capacity empty to avoid unintended consequences.

Purgeable Space is controlled by the operating system. When the system needs more empty space, it moves some purgeable space to empty space.

There’s no user action to hasten this transition. It can take days or longer.

The links below help identify what’s taking up space on the internal drive and provide ways to remove user-controlled data (Home Folder).

Rebuild the Spotlight index on your Mac.

What is “Other” storage on a Mac, and how can I clean it?

Free up storage space on your Mac.

GrandPerspective

How to delete Time Machine snapshots on your Mac.

This often occurs if the Time Machine Drive isn’t attached to the computer and TM Backup is set to run on a schedule.

TM Backup makes snapshots on the internal drive until the Time Machine Drive is attached. Then, the snapshots are transferred to the external drive.

View APFS snapshots in Disk Utility on Mac

See used and available storage space on your Mac.

Locate backups of your iPhone, iPad, and iPod touch.

Delete a user or group on Mac

If you use a suite of Adobe applications on this computer, they may create large cache files that can be removed. However, the Adobe cache files will be recreated as the applications need them.

https://helpx.adobe.com/ca/premiere-pro/kb/clear-cache.html

The same clearing of System Cache files can be achieved by booting into Safe Mode. They will be recreated as the system requires. 

I have found system data gets lowered quite a bit if you go to recovery, erase, reinstall the OS and migrate your files back. This cleans out misc. files and gets you back to initial load. While many do not want to go through all this trouble (even though the process is not that complicated) it does help the issue.

Add on

From another contributor @etresoft regarding Free Space and Available Space 

Free vs available disk space huge differe… - Apple Community

Quote >>  “ The "available" storage is the amount of used storage that the operating system could automatically delete if it felt that it was really necessary. The "free" storage is the amount that you can actually use for something.

There are system processes that run in the background and automatically delete some of the "available" storage and convert it to "free". If you completely run out of storage, then those system processes will try a little harder. When you "delete" files you are just hinting to the operating system that you don't need those files anymore. The operating system will eventually remove them, but on its own schedule.

Certain tools will allow you to force the issue and manually clean up some of this storage and manually delete local snapshots. But that is only temporary. "  << End Quote 

profbonev wrote:

Thanks for the suggestion. I presume this will work, it is a tad brutal as a solution. If nothing else works, I'll have to put the system through purgatory.

Yes it will work.

Yes it is brutal.

This is a Fast and Easy way to start over from scratch

There are those of use who would suggest this method only as a " Last Step of Resort " if all other avenues have been exhausted

The fact that the computer has already reached this level of lack of space

This tends to indicate, based upon past experience, it will likely happen again, in time.

IMHO, it would be better to learn how to Manage the existing Drive Capacity rather to go through this experience again, in time