The biggest problem with this game's inventory is that it keeps shrinking. Everytime you get a key item (Snowmobile, Sun Flame, etc), it takes up an inventory spot that can't ever be freed again. That really bites.
In a way, I guess that's realistic - the important stuff has to come with, and it takes up space... but at the same time, it'd be more realistic if the party could drop the Snowmobile off somewhere when they were done with it.