Yes, a factory restore would wipe out all existing partitions on your hard drive. But if you use Windows Backup and Restore to create a sytem image of only the C partition, you can restore the OS without deleting the other partitions on your hard drive. You can use a partioning software, like Partition Wizard, or AOMEI Partition Assistant Home Addition, both are free, to shrink your current C partition if Windows won't do it.
PS: there are other softwares like Macrium Reflect, or Acronis True Image, Easeus Todo Backup, which you can use to create a system image with.