Samsung Galaxy S II Skyrocket: Configuring storage

I have a Samsung galaxy SII Skyrocket (it appears .. a.k.a. SGH-1727).
When I download apps, I am always running into memory issues, so I have to move apps to my SD card to free up memory space, many of these that I move I find out later won't work on the SD card so this is frustrating. I bought a large SD card so I would have plenty of working space.
However, I discover that my working memory has been limited to about 2G, since the bulk of it is being hogged by USB drive. I assume I have to save what I have on the USB drive and relocate it to the SD drive, before I can remove/delete the USB function, hence expanding my memory available for apps ... however, I say 'assume' since I am just guessing and have not found this instruction on how to do so anywhere. Thoughts?

Current Storage reading:
1) Device Memory - Total space 1.97GB, Applications 1.67 GB, available space 207MB
2) USB storage total space 11.26GB, application 712MB, Pictures 257mb, Audio 160kb, downloads 3.34mb, misc 148mb, available space 10.40GB
3) SD Card total space 29.71GB, available 23.95GB,

Thanks for directing me where I need to go to understand how to better layout my memory use, and USB function redirection to SD card if at all possible.

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I'm not sure what you mean by USB storage. Do you have a usb device attached to the phone?

Nope. So are you saying that the USB drive shouldn't be there?

My USB visibility to my laptop is also a bit off at the moment, only giving me a view (after a fresh cellphone reboot) of two areas, my SD card and internal storage, but nothing is showing up on 'internal storage'.

yet, when I look at my 'storage' via my cellphone (after the reboot) it remains three areas as detailed above. When I explore the 'USB storage area (actually showing a multi-color bar showing the space taken by the different types of files, apps, pics/videos, audio, downloads and misc), the available space remains 10.4GB, showing nearly a gig being used (so don't want to just delete this USB storage without copying it somehow).

When I click and enter the appication area that is stored here, I see a lot of applications that I use regularily (facebook, skype, etc.) but each of these functioning apps (when further looked at) don't offer the opportunity to 'move to SD card' (button is grayed out). Just force stop, uninstall and clear data. Wondered why I had many app's that did that ... the common denominator seems to be that they are in this limbo area called USB storage???
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Revisiting the 'Internal storage' as viewed from my laptop, it now shows all the detail of the nearly 1 gigabyte of what is stored there. Guess there was a long delay to show it.

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Added a youtube video showing the three areas of my memory/storage with no USB attached but I am too new here to post the link ... groan

link to phone storage screens:
http: (slash slash) youtu.be/4G-kaSLjqgA]YouTube[/

So, I guess, since there is no response, that this is a stumper? Any other forums you would advise?