|The reason you can only backup 4GB at a time is because your external drive is formatted using FAT32. This is normally done for compatibility reasons. |
You can reformat using NTFS file system and that limit would no long apply.
You do understand that you will need to create a new backup every day in order to keep current.
Is you want to use the built in backup function in WinXP I recommend you partition your hard drive into at least three partitions. The reason is simple. Your operating system changes infrequently when you apply updates to it.
Your programs rarely change. Only when you may add a program.
What changes daily are your person files.
I am providing a link below to further explain the benefits of multiple partitions.
When using backup you should backup to a folder with a name that identifies when and what the backup contains. Besides, that is the only way you can store multiple backups and other data on the external.
Creating multiple partitions will require that you re-install everything.
In order to reformat you may need to off load any files you need from the external.
You could also partition that drive.