Dana and Robert, thanks for taking the time to post.
All the files being used are in File GDBs. I don't think they're anywhere near 1TB. Need to research to understand what a "configuration keyword" is.
Looked at the background geoprocessing. I have a 64bit machine but don't recall if I installed the 64 bit processor. Will do more research and post back.
For now, I think clipping the original road segment file is bypassing the problem. I'm a bit surprised since I've done this selection/layer file export with prior releases of the road segment feature without error.
BTW, running 10.6 desktop.