I suspect the restore point size is the issue. It sounds as if you have 120GB of "stuff" on your hard drive - 500GB minus 380GB free. That won't fit into a 10GB restore point.
I just checked mine - I think it's time for a clean-out because the restore folder is 486GB
While I share the cynicism about the dependability of System Restore, it did once save my bacon (and failed to do so a couple of times). I back up my "stuff" to four external drives on a four-weekly cycle (it's automated) and then delete the oldest ones on each drive when they start to get full. It's much easier to recover lost stuff from those backups, too.