Here is step by step how to change picasa database location, even a dumb person can follow these instructions 

Method 1 [ USING SYMBOLIC LINKS] for Vista 

1. Create a folder in another drive where you want to move the database, for example “Picasa Database” folder in E:\Program Files\Google folder. 
2. Now go to C:\Users\Zeeshan\AppData\Local\Google\Picasa2 rename the folder “Picasa2” to “oldPicasa2”. 
3. Copy all the contents of C:\Users\Zeeshan\AppData\Local\Google\Picasa2 to E:\Program Files\Google\Picasa Database. 
4. In Run (press WIndows+R) type cmd, it will open command prompt. 
5. In command prompt type [ mklink /D “C:\Users\Zeeshan\AppData\Local\Google\Picasa2” “E:\Program Files\Google\Picasa Database” ](without brackets) and press enter. 
6. You will get a message “symbolic link created for C:\Users\Zeeshan\AppData\Local\Google\Picasa2 <<===>> E:\Program Files\Google\Picasa Database 
7. Now delete the folder oldPicasa2 from C:\Users\Zeeshan\AppData\Local\Google. 
8. Now your picasa database is moved to E:\Program Files\Google\Picasa Database. 
This method will work in XP also only you have to find the location of picasa database folder and instead of using C:\Users\Zeeshan\AppData\Local\Google\Picasa2, use that location 

Method 2 [Change the location of Local folder only in Vista] 

1. Go to folder C:\Users\UserName\AppData 
2. Right click on folder “Local” and select Properties 
3. Go to Location Tab. Click on move and select any folder on other drive, for example F:\Users\Local 
4. You will be asked whether to move all the files from the old location to the new location, select Yes 
5. Now your picasa database is moved to F:\Users\Local\Google\Picasa2.

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