Why is my Final Cut Pro library file so bloated?
You are right to leave media in the original location to help save space. Beyond this setting, take a look at your Library's settings.

Manage Storage Locations

Final Cut Pro is likely creating proxy and optimised copies of your original media. By default, these temporary files are stored within your Final Cut Pro libraries. You can change the location of temporary files, see Final Cut Pro X: Manage storage locations.

When you finish working on a project, ask Final Cut Pro to delete all associated runtime created files:

Final Cut Pro.app > File (menu) > Delete Generated Library Files…



This will dramatically reduce the file size of your library.