Restricted memory optimization
C++   75.0
The program is designed to work with arbitrary text strings. They can be of any different lengths as long as neither exceeds 13824 characters. It uses 1,897 16-bit integers, which is equivalent to 949 32-bit integers. At first I was writing it in C, but then realized there was no function for reading a line.
The first command-line argument should be a filename. If a second argument exists, a summary of the edits is printed. The first line in the file is ignored while the second and third are the strings.
The algorithm is a doubly blocked version of the usual algorithm. It performs basically the same number of operations, but is of course much less accurate, since if a common subsequence gets split over the edge of a block, much of the potential savings are lost.
#include &lt;cstring&gt;
#include &lt;inttypes.h&gt;
#include &lt;iostream&gt;
#include &lt;fstream&gt;

#define M 24
#define MAXLEN (M*M*M)
#define SETMIN(V, X) if( (X) &lt; (V) ) { (V) = (X); }
#define MIN(X, Y) ( (X) &lt; (Y) ? (X) : (Y) )

char A[MAXLEN+1], B[MAXLEN+1];
uint16_t d0[M+1][M+1], d1[M+1][M+1], d2[M+1][M+1];

int main(int argc, char**argv)
{

    if(argc &lt; 2)
        return 1;

    std::ifstream fi(argv[1]);

    std::string Astr, Bstr;
    for(int i = 3; i--;)
        getline(fi, i?Bstr:Astr);
    if(!fi.good()) {
        printf(&quot;Error reading file&quot;);
        return 5;
    }
    if(Astr.length() &gt; MAXLEN || Bstr.length() &gt; MAXLEN) {
        printf(&quot;String too long&quot;);
        return 7;
    }

    strcpy(A, Astr.c_str());
    strcpy(B, Bstr.c_str());

    uint16_t lA = Astr.length(), lB = Bstr.length();
    if(!lA || !lB) {
        printf(&quot;%d\n&quot;, lA|lB);
        return 0;
    }
    uint16_t nbA2, nbB2, bA2, bB2, nbA1, nbB1, bA1, bB1, nbA0, nbB0, bA0, bB0; //block, number of blocks
    uint16_t iA2, iB2, iA1, iB1, jA2, jB2, jA1, jB1; //start, end indices of block

    nbA2 = MIN(M, lA);
    nbB2 = MIN(M, lB);
    for(bA2 = 0; bA2 &lt;= nbA2; bA2++) {
        iA2 = lA * (bA2-1)/nbA2,  jA2 = lA * bA2/nbA2;
        for(bB2 = 0; bB2 &lt;= nbB2; bB2++) {
            if(!(bA2|bB2)) {
                d2[0][0] = 0;
                continue;
            }
            iB2 = lB * (bB2-1)/nbB2,  jB2 = lB * bB2/nbB2;
            d2[bA2][bB2] = ~0;
            if(bB2)
                SETMIN(d2[bA2][bB2], d2[bA2][bB2-1] + (jB2-iB2));
            if(bA2)
                SETMIN(d2[bA2][bB2], d2[bA2-1][bB2] + (jA2-iA2));

            if(bA2 &amp;&amp; bB2) {
                nbA1 = MIN(M, jA2-iA2);
                nbB1 = MIN(M, jB2-iB2);
                for(bA1 = 0; bA1 &lt;= nbA1; bA1++) {
                    iA1 = iA2 + (jA2-iA2) * (bA1-1)/nbA1, jA1 = iA2 + (jA2-iA2) * bA1/nbA1;
                    for(bB1 = 0; bB1 &lt;= nbB1; bB1++) {
                        if(!(bA1|bB1)) {
                            d1[0][0] = 0;
                            continue;
                        }
                        iB1 = iB2 + (jB2-iB2) * (bB1-1)/nbB1, jB1 = iB2 + (jB2-iB2) * bB1/nbB1;
                        d1[bA1][bB1] = ~0;
                        if(bB1)
                            SETMIN(d1[bA1][bB1], d1[bA1][bB1-1] + (jB1-iB1));
                        if(bA1)
                            SETMIN(d1[bA1][bB1], d1[bA1-1][bB1] + (jA1-iA1));

                        if(bA1 &amp;&amp; bB1) {
                            nbA0 = jA1-iA1;
                            nbB0 = jB1-iB1;
                            for(bA0 = 0; bA0 &lt;= nbA0; bA0++) {
                                for(bB0 = 0; bB0 &lt;= nbB0; bB0++) {
                                    if(!(bA0|bB0)) {
                                        d0[0][0] = 0;
                                        continue;
                                    }
                                    d0[bA0][bB0] = ~0;
                                    if(bB0)
                                        SETMIN(d0[bA0][bB0], d0[bA0][bB0-1] + 1);
                                    if(bA0)
                                        SETMIN(d0[bA0][bB0], d0[bA0-1][bB0] + 1);
                                    if(bA0 &amp;&amp; bB0)
                                        SETMIN(d0[bA0][bB0], d0[bA0-1][bB0-1] + (A[iA1 + nbA0 - 1] != B[iB1 + nbB0 - 1]));
                                }
                            }
                            SETMIN(d1[bA1][bB1], d1[bA1-1][bB1-1] + d0[nbA0][nbB0]);
                        }
                    }
                }

                SETMIN(d2[bA2][bB2], d2[bA2-1][bB2-1] + d1[nbA1][nbB1]);
            }
        }
    }
    printf(&quot;%d\n&quot;, d2[nbA2][nbB2]);

    if(argc == 2)
        return 0;

    int changecost, total = 0;
    for(bA2 = nbA2, bB2 = nbB2; bA2||bB2; ) {
        iA2 = lA * (bA2-1)/nbA2,  jA2 = lA * bA2/nbA2;
        iB2 = lB * (bB2-1)/nbB2,  jB2 = lB * bB2/nbB2;
        if(bB2 &amp;&amp; d2[bA2][bB2-1] + (jB2-iB2) == d2[bA2][bB2]) {
            total += changecost = (jB2-iB2);
            char tmp = B[jB2];
            B[jB2] = 0;
            printf(&quot;%d %d deleted {%s}\n&quot;, changecost, total, B + iB2);
            B[jB2] = tmp;
            --bB2;
        } else if(bA2 &amp;&amp; d2[bA2-1][bB2] + (jA2-iA2) == d2[bA2][bB2]) {
            total += changecost = (jA2-iA2);
            char tmp = B[jA2];
            A[jA2] = 0;
            printf(&quot;%d %d inserted {%s}\n&quot;, changecost, total, A + iA2);
            A[jA2] = tmp;
            --bA2;
        } else {
            total += changecost = d2[bA2][bB2] - d2[bA2-1][bB2-1];
            char tmpa = A[jA2], tmpb = B[jB2];
            B[jB2] = A[jA2] = 0;
            printf(&quot;%d %d changed {%s} to {%s}\n&quot;, changecost, total, B + iB2, A + iA2);
            A[jA2] = tmpa, B[jB2] = tmpb;
            --bA2, --bB2;
        }
    }


    return 0;
}