WD 20EZRX OS USE purpose

Yes but it's suggested that you partition a smaller section of the drive to install your OS on, you can do this during the windows install by clicking on advanced drive options when you select the drive to install on. A caviar green is a very slow drive to use for your OS though, a small capacity disk like a 160GB drive should be pretty cheap to buy brand new, no matter where you are in the world...

Yes, I answered your question - yes, you can use it.

Your system will be slow though. Platter drives have read heads, kinda like a vinyle record player. Everytime you want to look something up, or store something (which your operating system wants to do all the time, not just when you click or drag something) your read head must first look for it on the spinning disk, then read or write, then move on to the next task. This is why it is advised to make a partition for your OS that is considerably smaller that 1TB. However, once you've partitioned your drive, you will then have an OS volume with windows installed on it, and another volume (or more) that you will use to store files on. The OS will work faster with its smaller partition because the information that it needs is all in one place, or at least close together. When you start using your data volume though, the very same read heads will be jumpiing back and forth running the OS and at the same time, getting the stuff you want. The extra time per read or write is tiny but it all adds up, and the additional movement of the moving parts inside your drive will not extend the life of the drive. That is why I recommend that you look to purchase a dedicated OS drive. I realise that you can get bigger drives for not much more money, but then you're going to be running into the same problem that you have with your 1TB caviar green.

If you intend to spend more money on your OS drive, go for the fastest, not the biggest. It's easy (unless you're talking laptops) to keep plugging in more and bigger storage drives - which is what drives like the caviar green range are for.

When I was a kid, the the fastest drives you could get were Veloceraptors. People would buy two and put them in RAID0, to make them work even faster. Nowadays SSDs are much much faster than that. If you really want your computer to sing, save for one of them. If not, get a small size, high performance disk drive - they are cheap. You only need a drive over 250GB if you're really lazy, you use a lot of massive programs all the time or you can only fit one or two disks into your PC. Even hardcore gamers, who use games that are 20GB-ish in size, often don't need more than 120GB for their OS drive.
Build yourself a computer that works well for you first, if you need more space, it's usually just a case of buying it. That way, even if you change your 1TB disk for a 3TB disk for storage, all you have to do is plug it in. No partitions, no copying, no reinstalling your operating system...