Wouldn't the better approach be to just physically copy every disk sector the way Norton Ghost does? That way you'd be guaranteed an exact backup.. Is there a problem with this approach?

If you have a 96GB empeg with only 10GB full then you'll need 96GB of space to back it up rather than 10GB. Trying to decide which sectors are unused is not worth the trouble, IMHO.

Regards,
Borislav