How much space needed for PS3 backup?

[jomari]

so, finally planning on backing up my ps3.

i can do it two ways...
1. i have an old external hard drive, 120g hard drive...
2. i can purchase a CF card with 16G for it.

for the external, i noticed, it wont recognize it, due to it being NTFS.
questions are...
1. what utility MAXIMIZES the use of the hard drive, without incurring extra cost?
2. whats so bad about using xp's format utility?
3. is it easy?
4. whats the ETA if ever i plan to backup my ps3?

for the second part, the CF option,

1. will it fit?
2. i think its a great option simply because i dont have to keep it hanging around my ps3 like the external hard drive.

just rethinking my current gameplan.

thank you for your input!