Windows – Why does the pagefile.sys of windows 8 shrink to just about 25% of the size of RAM when hibernation is enabled

Some of what you're describing sounds less like virtual memory and more like a disk cache, where the operating system keeps in-memory copies of the data it reads off of the disk, in case an application wants to read it again. In this scenario it may also delay writing "dirty" pages back to the disk in order to increase efficiency by writing a bunch of pages all at once.

Virtual memory is the other way around -- data is written into RAM first, and only into the swap file if the kernel needs to free up that RAM for some other purpose. (Not every bit of memory necessarily has a corresponding space in the swap file; otherwise you couldn't have a swap file smaller than your RAM size.) Conventional thinking is that this is the way it needs to be; it would be too expensive to keep copying the RAM to disk all the time when you don't need to. Think about how slow your computer runs when you're running lots of memory-hungry programs and it has to start thrashing the swap space.

That said, there are some experimental research operating systems that work more like you describe, with some complex rules for copying the memory back to disk at regular intervals, and the result is that there's no need for hibernate -- you can pull the plug on the computer and lose maybe 30 seconds of work. Check out CoyotOS, CapROS, or EROS if you're interested theoretically. I don't know what their performance is like, or what other downsides there might be to such a strategy, but when you factor in crazy things like memory shared with your video card or other devices, I'd imagine it's difficult to get it working properly for all cases. As far as I know, no production operating system does this sort of thing.

Yes, Hybrid Sleep is most likely causing this, see the second FAQ. Disable it by turning it's setting to Off.

What is Hybrid Sleep?

Hybrid sleep is another new power-saving feature designed primarily for desktop computers. Hybrid sleep saves any open documents and programs to memory and to your hard disk, and then puts your computer into a low-power state.

Unlike mobile PCs, desktop computers typically don't have battery-based power backup. So if a sudden power failure occurs to a desktop computer in standard sleep mode, data loss could occur.

But with hybrid sleep turned on, Windows can restore your work from your hard disk. On desktop computers, hybrid sleep is typically turned on by default.

When hybrid sleep is turned on, clicking Sleep automatically puts your computer into hybrid sleep. When hybrid sleep is turned off, or if your computer doesn't support hybrid sleep, clicking Sleep puts the computer to sleep.

— Microsoft - Turn off a computer FAQ

How does Hybrid Sleep relate to Hibernate?

Hybrid Sleep uses Hibernate to save the memory to disk, but doesn't actually hibernate the computer.

It can be configured to hibernate the computer after a certain time, which disallows manual hibernation...

To turn Hybrid Sleep on or off:

• Open Power Options by clicking the Start button, clicking Control Panel, clicking System and Maintenance, and then clicking Power Options.

• On the Select a power plan page, click Change plan settings under the selected plan.

• On the Change settings for the plan page, click Change advanced power settings.

• On the Advanced settings tab, expand Sleep, expand Allow hybrid sleep, and then:

  • If you are using a mobile PC, click On battery or Plugged in (or both), click the arrow, and then click On/Off.

  • If you are using a desktop computer, click Setting, click the arrow, and then click On/Off.

• Click OK, and then click Save changes.

— Microsoft - Turn off a computer FAQ