Welcome to Windows Seven Forums.
Your problem has occurred because for some reason you are using logical partitions, which are effectively an extension of the C partition. Free space is different to unallocated space in that there is a partition there occupying that space.
Your best bet is leave the C:\ drive as it is and delete the three logical partitions, then create a new primary partition or partitions on the resultant unallocated space.
You can have up to four primary partitions on one hard drive and if you need more partitions you can create logical partitions within the last primary partition.
Make sure you backup everything first before you delete your logical partitions and creating a restore point wouldn't be a bad idea either.
You might want to create a Partition Wizard boot disc for partitioning needs as it is far more versatile than Windows 7's disk management tool.