Hell, I've found ripping a DVD to MKV results in a 3-5gb file.
Then converting that MKV using handbrake, I can bring the size down as much as 75%. When you're talking about a thousand videos, that adds up.
TV series (especially older stuff) I can consistently reduce 80%+. This makes a real difference for shows that were on for 10 years.
And these all look fine on a 65" TV from 6' away. Why store more if I don't have to?