According to the Vista Help under System Restore, it does not save any info in the "Documents and Settings" folders so it shouldn't really be tracking anything there - unless I am missing something.
I do agree that moving your "Documents and Settings" folder(s) to a separate
physical disk will speed things up quite a bit but not for the reason of anything to do with System Restore. Rather, it is from 2 things:
1. Keeping your OS drive smaller - with really only OS related stuff
2. Having 1 physical drive contain your OS, your Program Files, and your Documents and Settings (personal data).
IMHO, disk IO is the singlemost bottleneck in todays computers. Most of the newer ones come with a more than fast enough processor for the average user and a sufficient amount of RAM (at least 2GB). In a
perfect world, you should have your OS, Program Files, and Documents and Settings (personal data) each on their own
physical disk if possible. This is the most "bang for your buck" short of having a RAID configuration.
Just my $.02
