Make sure you use Partition magic with caution, you can loose everything.
As an example, I have a 500GB
100GB is Partition 1 (Windows + software installed)
400GB is Partition 2 (All Downloads, Iso's, Drivers, OS installer)
My motive for multiple partitions;
When I notice my PC starts to bog down or when I get hit by a alot of spyware (I do not like antivirus software) I can simply run the OS installer on Partition 2 (or from a CD if it was not loaded on the HD) and format partition 1 and have everything back online in a matter of a few hours.
I also back up games I own (and some I don't

), simply to make installing them much faster and easier, although it is mostly multiplayer games I like to do this with (WOW, BF2, RS, etc)
I can reformat and install Drivers, software, games, all with out needing to load a CD