Speaking on ASR (with comments only referring to a full backup or restore situation)
How to Set up and Use Automated System Recovery in Windows XP
You need a second partition for ASR to work properly.
298278 - ASR Restore Procedure Does Not Succeed When You Specify Drive C as the Destination for the Backup File
Although the articles says ASR will not backup data files it does backup and restore everything that is contained in all the users Documents and Settings folders and subfolders as long as they are on the same partition as windows. It will not gather anything from other partitions on your drive. That information can be backed up separately.
When it comes to restoring, the ASR kicks in after Formatting your Windows Partition, copying setup files,installing Devices and Networks via the XP setup, booted from the XP CD and pointed to use ASR via pressing F2 (just after the F6 request is the F2 request) early in the setup procedure.
Even if the partition you are restoring is not "C" (your Boot Partition) it is advisable to run a ChkDsk on this boot partition before restoring with ASR as it can avoid multiple formats of the to be recovered partition caused by Setup checking the boot partition for errors after it formats the to be recovered partition. If Setup finds any errors on your boot partition the whole process will abort and need to be restarted from scratch.
For more information about other recovery options or using backup, follow these steps:
Click Start, and then click Help and Support.
Do one of the following:
In the Search box, type repair overview and then click Start Searching.
-or-
In the Search box, type using backup, and then click Start Searching
Emergency boot floppy.
Copy ntldr, ntdetect.com and boot.ini to floppy to boot your XP installation. These are hidden and System files (make sure options are set to see them).
How to Use System Files to Create a Boot Disk to Guard Against Being Unable to Start Windows XP (Q314079)
Q305595 - HOW TO: Create a Boot Disk for an NTFS or FAT Partition in Windows XP