Update 6/3/2021: Google Search Console tells me this page is getting popular lately. While I originally wrote this with PSX games in mind, you can apply it to most other CD based consoles. I’ve also converted Sega CD, Sega Saturn and Turbo Duo CD games from BIN/CUE to CHD for use in RetroArch.
The Redump set for PlayStation 1 USA is about
385GB (just the games, no demo/samplers etc) 512GB in 7zip format; 7zip is not supported by the Beetle PSX core so when I originally added the PSX library to my Launchbox/RetroArch setup I just extracted every game. This took up a significant portion of the 1TB drive I was using to store all ROMs; additionally Redump uses separate BIN files for every track on the CD so a single game would have multiple BIN files plus the CUE. I found by accident an old Reddit post where I learned that you can compress BIN/CUE into Mame’s CHD format which is supported by the Beetle PSX core; the result is you will have a single compressed file for each PSX game that is comparable to the original 7zip in size and directly playable.
Extract chdman.exe from mame0201b_64bit.exe into the same folder as your PSX BIN/CUE files. Then you can just run one command to convert everything to CHD:
for %i in (*.cue) do chdman createcd -i "%i" -o "%~ni.chd"
Expect this to run for a long time; on the Redump set, this conversion took about 1.5 days on an i7-4770K and a 2.5″ 1TB Seagate FireCuda hybrid drive.
You should also have free space equal to at least 1.5x the size of the Redump set before running the command Just make sure you have plenty of free disk space as this process will create new CHD files in addition to all the BIN/CUE files.