Hi Aaisha This has happened to me too. Here �s what solved the problem for me:
First do not just paste pictures in the ppt but save them on your computer first and then insert them. Before inserting the pictures open them with a programme like microsoft office picture manager and resize them to a size that suits you and compress them. I remember that even if I had compressed the pic before inserting it in the ppt, it would become too heavy again once I resized it within the ppt! There is also a compress picture option in powerpoint which appears once a picture is selected (in the edit picture tab). Perhaps it can fix file size for you within the ppt. I remember I had to go through the above described steps though
Something else that made a big difference were powerpoint �s background themes. Because I also worked in a more recent version I realised that the background theme had a huge impact on file size when I saved in the earlier version. I had to remove the theme and just use a background colour.
Finally a good tip is to save the presentation as 2003-07 ppt right from the very beginning! This way you have to work with the earlier version �s tools only and you can monitor the actual size of your file (in ppt format and not pptx) as you work on it.
HTH!
PS - EDIT: by "background theme" I mean the templates that Baiba told you about. Microsoft office is in Greek on my computer and I�m not sure about the terminology!