If you are here you have installed UnleashX on your Xbox. You may or may not have a new HD, doesn't matter. You may or may not be using DvD2Xbox app, I don't think it matters, some argue it does.
This forum does have 2 or 3 other related posts on this error, I found them confusing and indirectly answering the question. I will answer it very blunt.
You have the game you wish to copy to your Xbox in the disc tray, and you are about to click 'Copy Game Disc' through the dashboard.
**Notice I only have a little over 2GB free on E.**
Once you have clicked 'Copy Game Disc', you will see the percentage bar start, and the time left/elapsed remains at 00:00. Usually within 2 seconds (or more) you get this screen.
Now to clear up some confusion I saw, older/newer games for the Xbox will not affect the copying process resulting in the above error. I currently have 2GB free on my E drive. The game I am trying to copy is MORE then 2GB (lets say it's KOTOR2, which is almost 10GB). Error 112 means your HD does NOT have enough space to complete the copying process. Get a bigger HD, or delete some other games you don't need on your HD. I advise using cauting when using 'File Explorer', ALWAYS double check what you're doing. Enough said.
The other means of getting error 112 are having your copying folder in the wrong place. Make sure the folder is set for E:\Games (Under 'System Settings', Def. Backup Folder). This obviously sets the default directory for games when they are copied, and allows you to see them under 'Games' on the dash. If your game did copy and the Def Backup Folder wasn't assigned to E:\Games, you will NOT be able to play the game off your HD.
**Important Note**
If you have tried multiple times to copy various game, but ended up with error 112, the game folders will have been created in the assigned Def. Backup Folder (even if it isn't E:\Games, the folder will get created wherever the path is set!). Goto File Explorer, and Browse to the assigned folder. Delete ALL folders of the games that resulted in error 112. Once you have free space, you can copy these games, but you DO NOT want to have the game folder already created.
Hope this helped some people, a little long for a simple answer.