Molecular dynamics simulations of poly(vinyl methyl ether) in aqueous solution with weight concentration cw = 30% were performed in a wide temperature range by simulated cooling between 400 and 175 K. A shift of glass transition temperature due to plasticization effect is observed with the decrease of simulated TgMD by 25 K as compared to pure PVME at the same simulated cooling rate. The free volume is computed by using different probe radii (Rp). The free volume computed with Rp = 0.5 Å reproduces free volume amounts at the glass transition temperature from the free volume theories as well as thermal expansivity of the excess free volume given as αL − αG. A portion of 90% of the free volume is formed by molecular bodies of both polymer and water molecules. In the presence of water molecules, the free volume of polymer ends shows only a miniscule increase by 7% as compared to the free volume around main-chain monomer units. The free volume around hydrophilic polymer groups involved in hydrogen-bonding formation is decreased, in agreement with the predicted relation between mobility and free volume. A picture hinting why percolation of the free volume is naturally connected with glass transition temperature is provided. By using the computed free volumes, we predicted a value of the orthopositronium (o-Ps) lifetime in the structure to be τ3 = 1.31 ns (40.1 ± 0.5 Å3) in cavities formed solely by monomer units, and τ3 = 2.03 ns for the average cavity in the structure.