If you're creating a Safety Clone, you need to run for it or your system isn't really 'protected'. So, if it's on an iBook, the best thing to do is to create a partition on the internal drive to use as the Sandbox. That way, you don't need an external drive for it.
Your backup, though, should be on the external. And, make sure you back up the original volume, not the Sandbox (there's really no reason to back up the sandbox).
The appendix of the manual explains how to repartition for a Sandbox, but you can also use the program iPartition, from Coriolis Systems -- we use that here, and it works well.
Hope that helps!
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--Dave Nanian
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