As the only really important thing on the PC is your data, I would advocate the following rather than using drive image:
Create a data partition. Point all your programs to save files to the data partition. This includes your mail boxes and address book. I would also put swap file/page file on Data drive too. Likewise Temp folder and temporary internet files. You will need to give a bit of thought to a directory structure for the data drive, but once in place it is a simple matter to back up as everything is on the data drive and can be dropped onto a CD or USB flash drive periodically. Other benefits include separation of your OS and progs from your data therefore C: doesn't get so fragmented and therefore everything will run that bit quicker. Also, futeure crashes of your OS or a prog will not trash your data. Once you've done that, taking an image of the C: drive so you can quickly restore your OS makes sense too.