Windows 7: Restore from external hard drive

I recently moved from XP to Windows 7 Pro. Before I did this I backed up a good deal of my C: drive using the XP backup/restore feature. The resulting backup file was copied to an external hard drive. Now that I'm on 7 I would like to restore some of these old files. However, when I go to the backup/restore app on Windows 7 the only option I have is to select the backup file from a network location. But it's not on the network, it's on an external hard drive that I plugged in. How can I just tell it to look for the file on the external drive?

This is not obvious because Windows 7 cannot read the XP backup files. Have a look at this thread for more information. This is really catch 22.

Well, thanks for the help, but if I'm reading this right, there is no direct way to restore a backup from XP onto 7. You have to involve Vista in some way or buy a third party tool. What a joke.

If you still have your XP installation disk (and if it comes from the same PC), you could try to install it under VM (different solutions are possible) and recover the data that way.
The problem with the windows backup/restore is that the system uses its own file scheme and you cannot recognize your files any more. That's why I prefer to do it by hand or use a program that does not alter my data structure.