You can try running pg_resetxlog (situated in the contrib directory in the
source). It will reset the wal files and will allow you to restart the
postmaster. It is not the recommended way but I used in in dire
emergencies and it worked.
Normally, when you fill up the drive because of WALs, you should try to
free up 16MB. If the drive is the same as the database, you can move one
file from the database directory to another partition, create a soft link
to the file, and restart the database. Once the WAL files are removed by
the postmaster, you should stop it, and copy back the file. Try to upgrade
to 7.1.3 since it solves some issues where long transactions take up an
unordinated amount of space unecessary.
As regards to the space required by the WAL files this depends on the
configuration (postgresql.conf). There is a paramter which controls the
amount of WAL files to create (each file takes 16MB).
Hope it helps
Robert