Windows 7 says a 8.6 GB file won't fit in 14.7 GB space?

It's formatted as FAT32. The largest size file supported on FAT32 is 4GB. You will have to reformat the drive as NTFS or ExFAT.

The issue is that the target filesystem is FAT32, which only supports files up to 4 GB in size. The error message is not very clear if you've never run into this issue before. You can fill the 14.6 GB space with multiple 4 GB files, but no single file may be larger than 4 GB. You'd need to reformat the disk as NTFS or exFAT to support larger files.

In addition to David Marshall's answer, there's no need to reformat the drive. You can upgrade from FAT32 to NTFS with the convert command.

>convert /?
Converts a FAT volume to NTFS.

CONVERT volume /FS:NTFS [/V] [/CvtArea:filename] [/NoSecurity] [/X]


  volume      Specifies the drive letter (followed by a colon),
              mount point, or volume name.
  /FS:NTFS    Specifies that the volume will be converted to NTFS.
  /V          Specifies that Convert will be run in verbose mode.
  /CvtArea:filename
              Specifies a contiguous file in the root directory
              that will be the place holder for NTFS system files.
  /NoSecurity Specifies that the security settings on the converted
              files and directories allow access by all users.
  /X          Forces the volume to dismount first if necessary.
              All open handles to the volume will not be valid.

FAT-formatted drives can't see files larger than 4 GB; you'll have to reformat it as NTFS. You may have a directory that is 100 GB in size. However, no single file may be more than 4 GB.

The maximum possible size for a file on a FAT32 volume is 4 GB minus 1 byte (232−1 bytes). Video applications, large databases, and some other software easily exceed this limit. Larger files require another formatting type such as NTFS.

Ref.: Wikipedia article on FAT32.