provide an option to compress the recordings that are X days old.
that allows the opportunity to save more recordings (disk space saved) before automatically deleting old recording to free up space
Not suggesting transcoding. Suggesting compression - think ".z" or ".gz".
I assume when you provide a FPS option that will also help in limiting the size of the files but that is a different approach.
I think that compression would be a nice feature, especially for people who have processing power to spare because of the hardware compression on cards such as the bc-h16480a.
A video file most definitely will not have a tremendous amount of RLE compression (since that is built into the vector encoding of the mpeg4 algorithm). however there will be some - it is very file dependent.