Can't partition unalloted space

I am a novice (well,almost). I recently upgraded to Windows 7 from Vista on my Dell Inspiron 11z and used the Dell Upgrade Disks for it. But I went into the advance tabs, repartitioned the disk and performed a clean install so that I could get two partitions instead of the default one which my Dell Inspiron 11z came with. To put it simply, I wanted a main partition for my programs, and one more partition for storing data.
I don't know where I went wrong, but I now have 4 partitions: one with Windows 7, and three more recovery and system partitions (I'm guessing one of the recovery partitions is for Vista courtesy Dell, while the other two were created during the upgrade). Two of these four show up in My Computer (primary and recovery). And I also have unalloted space in place of the second partition I created (or so I thought). See the attached screenshot.
The problem is that I get a warning if I try to create a new simple volume on it, which says something about converting the basic disk to a dynamic disk. See screenshot 2.
Some basic research revealed that I can only have only up to 4 basic disks, and therefore the warning box.
My question: It is safe for me to just make the unalloted space into a dynamic disk and let the recovery partitions remain as they are? As I mentioned, I just need the new partition for storing files and not for installing another OS.
If not, then should I delete one of the system or recovery partitions so that I do not exceed the limit of four basic disks? Which one is the safest to delete? I don't really intend to roll back to Vista, but don't mind keeping it since space is not really a concern.

Reading from left to right on your partition map in disk management:

39 mb OEM: created by Dell for support of some kind. May be needed for warranty or support, but not needed by Windows 7.

Recovery D: You would use this if you wanted to go back to Vista. May pertain to your warranty also—if you had problems and called Dell, they might tell you to go back to Vista at least temporarily and if you did not have this partition, you may not be able to comply unless you had separate DVD recovery disks.

System reserved 100 mb: Created by Windows 7 install. Used primarily to help with Windows 7 system recovery, but it is not needed if you have access to a Windows 7 disk. Most people have it and just ignore it.

C: this is Windows 7. Most people would make this 40 to 60 gigs rather than 29.

188.20 unallocated. This is not yet part of any partition, but could easily be added to C if desired. It cannot be easily added to any other partition unless you use certain free third party tools (Paragon, Partition Wizard, etc)

I would get this down to no more than 4 partitions and avoid dynamic disks.

If this machine is out of warranty and support from Dell or you don’t care about either of those things, you can eliminate all that stuff to the left of C with third party tools.

Another possibility is to simply reinstall 7. Depending on what kind of disks you have from Dell, you may be able to dive into that now, or you may have to first restore to Vista. Certain people on this forum can help with that.

So—decide on these issues:

Do you care about Dell warranty or support?

Are you willing to give up on Vista entirely?

Would you consider a reinstall of Windows 7 or do you dread having to reinstall your programs etc?

Are you willing to get involved with third party programs such as recommended by Minotar? If you do this, you may not have to reinstall at all.

Minotar:

I don't think it is a direct backup either--Vista would obviously occupy more than 1 gig. I'd guess whatever is in it can be used to make DVDs which can then be used to restore Vista. Haven't had a Dell in a long time or ever had a PC with a partition like that, but that is my understanding of how they work.

I could be wrong and not for the first time.

Assuming discs can be made from it, I'd guess it could then be deleted and not disqualify the user from any Dell support or warranty?

ignatzatsonic said:

So—decide on these issues:

Do you care about Dell warranty or support?

Are you willing to give up on Vista entirely?

Would you consider a reinstall of Windows 7 or do you dread having to reinstall your programs etc?

Are you willing to get involved with third party programs such as recommended by Minotar? If you do this, you may not have to reinstall at all.

Once you have decided on these issues, there will be some here to help.

Thank you for all the replies, and my apologies for the delay in writing back. To answer your questions:

1. Yes I do care about Dell support because the notebook is just a three months old.
2. Yes I am willing to give up on Vista entirely. I have the Windows 7 installation disks.
3. I rather not reinstall Windows 7 if that can be managed.
4. I can use third party programs, and had in fact tried EASEUS Partition Master which would not allow me to create another partition on the unallocated space, and wouldn't tell me why. Which is when I posted this thread.

To sum it up, I don't mind losing D or any other partition that would not void the Dell support. I have already got into trouble with them because they refused to help me with webcam drivers for my notebook since I had performed a clean install. Its working through Skype though, which is enough for me. But this also means that I don't know if I really have the support any more.
D has a handful of folders named Dell, Program Files, Sources, Tools, Users and Windows. I can easily burn them to a disk if needed.

Thanks!

Backup first.

Then do a clean install with your Dell recovery DVD.