For disc space might maybe be possible using 4 CD for the game (some PS1 games had 4 cd's) and in 2 discs put simulation mode (divide them in part 1 and part 2 like driver, chrono chross, final fantasy etc.) and do the same for arcade mode (another 2 discs with part 1 and 2) so 4 CD's (2 for sim mode and 2 for arcade mode) which is like 2.5-2.8 GB together (650-700 MB for each disc).....
You cant really split GT sim mode into multiple CDs
Driver was a story mode game hence 2 CDs, same with Metal Gear Solid & Final Fantasy had a bigger story and world so it had to be on 4 CDs.
But with each of these games, you cant go back to earlier places(most of the time), with GT you can do sunday cup any time you feel like it.
In GT you're not limited by any story, well GT6 did have an advancement system in place but that was not around in GT2 and GT3.
Heck, when I got all gold in GT2 license tests, i jumped straight to the endurance racing.
When I got all gold licenses in GT1 I took the Nismo 400R and went into the Normal Car Cup.
GT3 race menu had the following events
Beginner, Amateur, Professional, Rally, Endurance.
Each had cars, tracks, and AI difficulty for that level of event.
Not fully sure on how it is set up internally.
But it is most likely script based and scripts use kB of space,
Use X track run in Y direction
Use X cars from carlist with Y set ups
Use X level difficulty for AI
Award X credits, award Y vehicle, in Z color, if finish in 1st.
For instance the MX-5 endurance on Apricot Hill
One of the AI was a MX-5 1.8i & it always ran Super Soft Tires so it pitted every 3 laps & the AI was rather easy to beat even(if your car was a 1.6 MX-5 & you were using stock tires)
You won 100,000cr for first and the prize cars were Mazda MX-5 (89), Mazda MX-5 (93), Mazda MX-5 1.8RS or Polyphony 002
Another reason a decent chunk of space was used by CD Audio for music which GT3 had more of compared to GT2, GT does make up some space by not having as many vehicles compared to GT2, GT2 had 3.5x more vehicles.