backup all files on USB drive?
 

I made the mistake of buying an external USB drive, not realizing it wouldn't support a bootable clone (it was cheap, so I'll probably pick up another one later).

Should I choose backup-user files, or can I still choose backup-all files if I'm not concerned about the extra space?

All Intel macs do boot from USB. MAny PowerPC Macs will, too, with some monkeying around. been awhile since I did it but do remember the steps were on macosxhints.

Use "Backup - all files". If you've got an Intel Mac, use the "GUID" partition scheme (see Disk Utility's Partition tab, specifically the Options button).

Otherwise, it's still a useful backup -- the User's Guide explains how to restore even if the drive isn't bootable... so copying all the files is still useful.