For those who don't know how to make an MTK droid tools backup, see the guide @ http://forum.hovatek.com/thread-468.html
During backup, MTK droid tools also saves a Nandroid backup to the SD card of the phone (apart from the MTK backup saved to MTK droid tools / backups folder) and this is saved to the clockworkmod/backup/ folder. If there's not enough space to contain the Nandroid backup on the phone's SD card, you'll get the "Zero file, no space left on device!" and the MTK droid tools backup will fail.
To fix this, close MTK droid tools and ensure there's an SD card in the phone with enough free storage space (at least 5GB free to be on a safe side) then repeat the procedure.
* If you still get this error despite having enough space on the SD card then its possible the Nandroid backup is being saved to the Phone memory instead of SD card so ensure it also has sufficient free storage space
* Install Busybox on the phone