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#11
If you haven't changed your settings since Win2000 then you are way overdue for a clean reinstall. You may not even know the lightweight instantaneous OS which Win7 truly is.
The reason it is suggested you unplug E is so you can plug it back in if something major is missing, even though Disk Mgmt shows it should not interfere and you say you can back everything up. So, yes, you can format or (better yet) wipe E if you want: Disk - Clean and Clean All with Diskpart Command
Do yourself a favor and plan some time ahead to wipe your HD and clean reinstall Win7 for best performance from the best OS yet. Here are tips for getting a purrfect reinstall - use the ones which apply: re-install windows 7