You said you didn't have space on your PC's hard drive for the second set of the 3500 tracks at 70% of the size of the WAV files. ALAC files are approximately 30% smaller than their WAV form.
Since it seem you are unable or unwilling to move data to make space for the easy conversion, then you'll have to do some advanced things to run a script I will have to write.
There seems to be a ConvertTrack method in iTunes that I could use. So basically, you'll have to edit your iTunes Preferences, to set the Import Settings to use Apple Lossless. Then run the script.
Now I have to write a script to either use what you select or find all WAV files in your library. I typically make the user select the tracks as I think the user knows what they want to alter better than automatically selecting data in iTunes.
The script will convert the track from it's current form, to Apple Lossless, then delete the WAV. Since I am using iTunes to delete, there may be a prompt to see if you want to recycle the song or not, I will see later when I run the script on my system. Since there is not enough room on the PC drive for the new track and the original WAV, then you may be required to click NO 3555 times. Not sure yet.
I will provide instructions on how to run the script.
You need to make a backup of the WAV files in case there is a catastrophic failure, since you don't have room for a second copy of these files they need to be somewhere else, like an external hard drive, CD or DVD. You'll need to figure out your own backup solution. I suppose the iPods are a backup, but I would rather have to instruct an "older" person on how to pull tracks off of an iPod.
Off to make a few hundred WAV files in my system to test with. Then start writing the script. This may take a day or three. I have never made a destructive (delete) script before.