There is not enough contiguous free space for a fail-safe replacement of the directory.
I get that message I do the same thing. Cancel the rebuild. Re-run it. (because you can't click "preview" at that point), THEN click Preview. Attach backup storage. Make a complete clone from the preview. iirc you have to cancel again and rerun again because Replace is no longer an option. Then replace. Takes a LOT longer to do all of that, but on rare occasion it's totally worth it.
Of the hundreds of times I've done that, FIVE times the repair has aborted midway though, leaving the drive trashed beyond recognition and requiring me to reformat and restore from the backup I just made. Once before this was my golden rule, it trashed it and I had no way to repair it, it was toast. DW wouldn't find any changes to make when reran.
So, odds are really low that it will blow up, but IMHO it's just not worth it. Even with long odds, the losses are just too high to risk.
DW's Preview option is absolutely their best feature. Treasure it!
BTW, don't do like they say and "make free space". No. Do NOT write to a drive with a damaged directory. That's just asking for trouble.
