I have done that since back in the Win3.11 days. I use a dedicated partition and then fix the size of the swap file. The size relates to how much real RAM you have. The old rule of thumb no longer is meaningful. It used to be that the swap or Pagefile should be about 2.5 times the amount of real RAM. Well, back when we were using 1 or 2 MB of RAM, that was relevant. But now with 512 MB or more of real RAM, that becomes excessive.
Unless you are dealing with video files and large graphics, the Pagefile usage drops way off when you have maximum real RAM.
I have had over 512 MB for the past couple of years, and the Pagefile size I set is 300 to 500 MB, and it has never been a problem. Things are very stable that way. That Pagefile partition is about 1.2 GB because I also use it as a temporary CD cache for burning. I can copy an entire CD to that \CDCACHE folder and then just about eliminate buffer underrun. That was my own "burnproof" solution long before that technlogy was built in to the newer burners.
The main advantage of having the Pagefile in a separate location from the OS partition is that is does not cause system and program files to be pushed around. moved and fragmented. In the main partition, you can minimize that by fixing the size of the Pagefile.