A MySql database needed to be removed and upon deletion of that single database, the extremely large three gigabite ibdata1 (data) file remained. Here are the steps I took to reduce or shrink the file once the database was removed. Since there was no other use for this MySql installation, there remained the MySql system databases.

Show Databases

• At the mysql command, the command show databases; is used to determine what databases remain.
  mysql> show databases;
• The results were information_schema and mysql.

Backup Databases

• mysqldump -u root -p mysql >mysql.sql
• mysqldump -u root -p information_schema >info.sql

Delete Databases
In this case the files were located here: D:\MySQL\MySQL Server 5.0\data

• Stop the MySql server service
• Delete the ib_logfile0, ib_logfile1, ibdata1, servername.err, servername.pid files (where servername is the name of the server).
• Start the MySql server service

Restore Databases

• D:\MySQL\MySQL Server 5.0\bin>mysql -uroot -p mysql < mysql.sql
  Enter password: *********
• D:\MySQL\MySQL Server 5.0\bin>mysql -uroot -p information_schema < info.sql
  Enter password: *********

Another approach might be uninstall MySql and reinstall it. This was more fun.