As said it is a partition with the imaged files (and perhaps the backup software as well).
Certainly you can delete it but we suggest that you leave it alone.
What is a backup partition? Say you totally screwed up your windows with a ton of virus' spyware and who knows what else. In that case you can start the restore option and re-install your windows to brand new.
I know this is an old thread but my situation is slightly different. I upgraded from Windows Vista to 7 on my laptop a few months ago and it retained the partition, which I did not want ($30 upgrade with a verifiable student e-mail account, well worth it). I did a clean install, so there is no HP software on my drive (thank goodness). Is it okay if I wipe it and use the space? Under properties it shows that I am using 10.4G of 11.9G, but there are no files in this partition. Even if I unhide my files it has nothing. I have a system restore disk and I manually backup (image and data) on a regular basis. Regular for me is about once every 1-2 weeks depending on what programs I have installed or uninstalled. I could really use the space on this laptop since it only has a 160G HDD. Furthermore, if it really does contain the original HP image and/or Vista then I can honestly say that I do not want it.