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#11
This is really up to User preference, based on whether you want to rely on backup images and want them lean, so that if Win7 becomes irreparable you can reimage C in 20 minutes and have your data set current and ready in its own partition.
However you can achieve this for the most part by keeping everything on C and backing up both image and files regularly via the Win7 Backup Center: Backup Complete Computer - Create an Image Backup
Backup User and System Files
I stopped linking User folders to another partition except for a large video collection when my Downloads refused to install due to permissions issues which I couldn't fix. It wasn't worth the trouble.
I would however keep everything related to Programs on C as it becomes part of the OS until uninstalled.