This is saying that Leopard weighed in at 12 GB everything included, unpacked and in use; accurate-ish as of 10.5.8 on a PPC Mac. Snow saves you 7GB, for a new total install space of 5GB.
Damn. Why does Apple have to word it like that?! I was excited there for a minute.
"Snow Leopard takes up less than half the disk space of the previous version, freeing about 7GB for you enough for about 1,750 more songs3 or a few thousand more photos."