Am i right in thinking you want your external hard drive to become a bootable drive-and not just to store data?
If so, as far as im aware, windows does not recognise usb as boot devices and so will not load up the operating system:
"Current versions of Windows should not be installed to USB hard disk drives because Windows does not support USB hard disk drives as the primary boot device. This paper introduces the expected industry participation related to the following"
Here is the link to the origin of that quote:
http://www.microsoft.com/whdc/device.../usb-boot.mspx