The built in utility is free in the sense that it's already built in. However, it simply doesn't work with some configurations. The only way to find out if it works for your particular setup is to recover an image and see if it boots. If you recover to a separate drive, and it doesn't work- no harm. You can simply boot back to the original drive. But if you recover over the original, and it doesn't work... Oops!
Like most built in Windows applications, there are free 3rd party options that work much better.
Macrium Reflect is the best free image recovery tool I know of. By default it compresses the OS image to about half the actual usable space. If desired, you can choose to make a bit for bit copy, but in most cases, why would you need to keep the page file, hibernation file, restore points and empty space? Additionally, an image file can be mounted to an unused drive letter, and individual files or directories can be viewed or copied out. It supports networking, and will retain alignment if the partition was aligned when an image was created.
Another consideration is where will you store the images? Image files are somewhat fragile. If you allow your defrag tool to run over them, or move them, they loose reliability. Usually they can still be recovered, but it may take several tries. You can read them as many times as you like, but to be reliable, they should be original. Also, six months or one year from now, will you want to be forced to revert back to an image you made today? Thats a great option to have, but wouldn't it also be good to be able to recover to a snapshot that includes changes you made to your setup in the future? This is only possible by keeping more than one image file.
I make a partition on the inside edge of each disk I own. It's the slowest part of a HDD, and you don't need access to image files often. The size varies by which of my computers can access the particular disks. An internal disk only services a single computer, while an external drive services both my desktop and laptops. I keep an image that represents a fresh install with only a few essential tools added. This is used for troubleshooting. The next image includes an early setup, but with all the programs I had at the time, and most of my preferences. If bad goes to worst, this image would save me about two days of re-install. I keep two or three additional images that reflect a much more current setup. When I am sure a newer image hasn't had anything bad introduced to it, I will delete an older one to make room for a current one. This method allows me to go back to a recent snapshot, but still have the ability to revert to an older snapshot if something is wrong with the newest.
Also, I keep a log pinned to my word processor's jump-list on the task-bar. If I make changes to my system- change a setting, update or install a new program- I open the log and make a note of the change. Then, when I revert to the latest image, I refer to the log, and remake the changes I had made, but were lost by recovering the previous snapshot. Once everything is updated, I make a new image set- a new image for each drive that i keep them in. Let's say I'm forced to revert back over several images, from, say 6.4 to 5.3, due to a problem in both 6.4 and 6.0 that I can't fix. By referring to the log, I can easily remake all the changes that I liked, without forgetting any, before cementing a new image set- 7.0- to replace the fubared ones.
To keep multiple image sets, it's essential to move all data out of the OS/programs partition. The OS partition must be kept reasonable small, or there will simply not be enough storage to keep multiple copies of it. Moving data out has two advantages. Not only does it help with the space requirement, but data survives through the OS recovery process. All user folders except the AppData are easily moved with the Locations tab. By utilizing a program like GetFolderSize or WinDirStat, one can easily see what other data can be moved to free up room. Much of this data can be moved by creating a symbolic link to another partition. Some programs won't run properly if their directories are moved with a symbolic link, so some experimentation is warranted.
Another consideration is security. By encrypting the image partition with TrueCrypt, one can make it much harder for a malicious program to infiltrate an image file from the past. The partition is typically only mounted when creating a new image with a presumably virus free freshly restored image, or when booting from a recovery CD. These two times are the only opportunity for a malicious program to infiltrate an image file. When the partition is dismounted, it is impossible for a bug to install itself into an image. It can theoretically write over the portion of the disk where the image resides, destroying the image, but since it can't break the encryption, it can't do anything to the images unnoticed. Hiren's Boot CD has both TrueCrypt and Macrium Reflect, so the image partition can be mounted for recovery.
As you can see, there are many considerations for advanced imaging and recovery. Not all techniques need be employed to achieve some benefit. However, along with the easiest way, you also asked for the best and cheapest.
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