You had to resurrect this thread ..
Yes, too small partitions are definitely a potential liability. Even if you load your apps (or games?) to another partition, they will still dump stuff into your boot partition (Windows folder). Make your boot partitions plenty big.
My boot partitions are 5GB each (W2K, WinME, Whistler Pro beta1). How did I come up with that number? I knew that my OS & apps take ~2.5GB each (actual data). I *doubled* that .. to leave plenty of room. Actually, my W2K partition is up to 3.5GB now .. which only leaves me 1.5GB free .. but I have everything installed, and there are things I could move off if I wanted.
Partition Magic will let you resize without destoying data, but it's better to do it right the first time. And it may not be as simple as you think, to resize your boot partition. Iy you want to use space that now being used by your extended/logical drives, you will first have to shrink the extended partition .. but in order to do that, you'l first have to shrink the logical drive .. see what I mean.
Bottom line: if you make a separate boot partition for your OS & apps, make the sucker *plenty* big.
(can you tell I have a little experience at this?)