Not sure how to delete the actual GB file within GB.
You don't delete them from within GarageBand. You move the GarageBand project package to the Trash. When you create a project, GarageBand will store it an a file named something like "MySong.band". By default they are located in the folder
Your Home Folder > Music > GarageBand > MySong.band
Move the xxx.band files of the projects you do no longer want to the Trash.
Playback couldnt' continue because it wanted me to optimize GB performance.
This may happen, if you have too many effects or too many other Applications open that need plenty of RAM. Quit iTunes and Safari, and any other application that you do not really need, while working with GarageBand. It will also help to reboot the system, before you start your project. Sometimes third-party software may be leaking RAM, and then you will be running out of memory. How much RAM do you have, btw.?