That makes perfect sense Jwerner,
My opinion on backing up data is that most people don't need to do it.
Hard drives rarely break, so an external would be your best choice, plus its not on the web so its probably safer? (assuming you have personal info on it)
Here's a suggestion.
Who is your isp? Cox Communications is mine and you can create a personal "webspace" with a limited (mine is 10gb) storage space, so put it on there and reformat, then transfer.
On my computer that I had recovery cds for I'd do a complete reformat/restore every 6 months, then installed whatever programs/games I needed from there.