You do not have to necessarily backup any drive to install a newer (i.e. larger HDD), that BS. You'd only have to do that if you wanted to backup your Save Games, Backups and Soundtracks provided that you don't have any of this stuff. or you don't need it on the new Drive just get an Evox / Avalaunch? (do any exist) install CD's (i.e. Slayers 2.5) and just run that on the new Drive and you will have a working Drive in less then Three Minutes.
I know 'couse I had no choice when my old 8~10GB stock Seagate Drive got fried during a misfortunite Hotswap with the PC. The upshot of which is that I now have an 80GB HDD in the Xbox!