(you left out an option for 500-1.0)
I have 750GB in the machine and another 640GB of network storage that I use for backups. Of my 750: I use 30GB for Win7 + installed programs, and 100GB for storage of everything else including digital photos. Actually on the 750 I have another spare partition that I use as scratch space. If I need to rearrange some folders for some reason, such as wanting to burn to DVD or whatever, I can copy the folders to this spare partition and work with them. I don't worry about backing up this partition since its data is just a copy of the other data that is already backed up.