Recently I've been having an issue whereby when I use the "autofill" option to fill my iPhone with music it will select far more music than it will hold, despite the fact that it has been told to reserve some free space for future applications/photos/data.
Fortunately I've found a solution to this which has worked for me:
1. Select your iPhone (or other iPod) from the devices section of the right hand panel in iTunes
2. Click on the "Summary" tab in the main window of iTunes
3. Ensure that the option to "Manually manage music and videos" is checked
4. Now go along each of the tabs at the top of the screen (Tones, Music, Movies, TV Shows, Podcasts, iTunes U, Books, and Photos - it seems that Apps doesn't need to be included here) and make sure that the "Sync xxxx" box is NOT ticked
You will now be able to use the autofill option by selecting the "Music" option under the device, choosing to Autofill From: either your entire music or a specific playlist and hitting the Autofill button. Do check the options under settings to make sure that is is set up the way you want it to be, for me I tick all 3 boxes (Replace all items when Autofilling, Choose items randomly and Choose higher rated items more often) and reserve just under 1GB of space for any future apps, videos or books that I might want to add in the future.
Using the above method has allowed me to use autofill and not have the situation where iTunes keeps trying to add more music that the device will hold.
Hopefully this will be of use to people who have experienced this same problem and have been stuck for a solution.