ermm, yes this possible by just backing up the relevant directories, but it does depend on what Windows release you are using. look below....

Windows95/98/98SE/ME/NT4.0
Backup the following directories...
\windows\all users
\windows\application data
\windows\local settings
\windows\profiles
\windows\favorites
\windows\temporary internet files (IE)
\windows\desktop
\windows\offline web pages
\my documents
ANY *.PST (Outlook Email store), *.PAB (Outlook personal address book), *.WAB (Windows address book) Files

Make sure you set the view options in Explorer to show all hidden, system files. Backing up these directory will include some directories below it with data in it, ie.
\windows\local settings, will have ..\appication data, ..\microsoft, ..\identities (outlook express emails)...etc...
your passwors etc for website is mostly kept in cookies, which also would be included in these directories, i.e.
..\temporary internet files.

Windows 2000/XP
\Documents & Settings
ANY *.PST (Outlook Email store), *.PAB (Outlook personal address book), *.WAB (Windows address book) Files

this directory basically keeps everything for each user, just as it's name states.

To restore this data, for emails, you need to import the data back in via the import/export filters, if you just dump the whole directory and start outlook express it will fail, since outlook exp creates a special registry entry, hence the ..\identities\REAL LONG REGISTRY KEY\outlook express...
directory structure. Also OE will fail if it encounters a mail database which has a differening encryption cipher i.e. 48bit vs 128bit.
For favourites and cookies etc, you just need to copy them into your profiles folder, for which ever user is logged in ,
ie, if you don't login to your computer, its mainly just kept in..
\windows\favorties, but if you use a login name, and each user has different settings (user profiles) etc... to enter windows at startup it'd be in......\windows\profiles\*UESRNAME*\Favorites
same goes for Windows2000/XP but you'd start at \Documents and Settings\*USERNAME*\favorites etc...