Dan Bowman sent me the following link and asked me to comment on it: http://lifehacker.com/5467758/move-the-users-directory-in-windows-7
It needs little comment. It’s a brilliant solution to the problem.
Here’s the issue. You can move directories using registry entries, but there will always be some unknown number of programs that assume everyone stores everything in C:\Program Files, C:\Users, C:\Documents and Settings, or other directories. So it’s better to just let your system look like everyone else’s, and use a Unix-style symlink to move directories to another drive and forget about registry hacks. Then any program, well-behaved or not, will continue to work.
Take this approach, and you can actually use Windows 7 on a 30 GB SSD and live to tell about it.
What I don’t know is if you could format two drives, link c:\program files to d:\program files, then install Windows, and have that work properly. The next time I have a system to try that on, I think I will. Of course, if you’ve tried that, I’d love to hear from you in the comments.