The best thing to do is have a small OS partition, which just has basic stuff like Windows, Firefox, AV program etc. I recommend 8GB but you can go as low as 6GB. Don't try for 4GB though - you will be able to install Windows okay but about a year later after all the crap mounts up in your profile folder, Windows Updates, .NET compiler cache etc you will run out of space and Windows will rapidly die.
I then usually have a programs partition where all my apps and games get installed. Finally, have some data partitions or drives.
The reason for having a small OS partition is twofold. First, you get better performance. The outer edge of the hard drive is the fastest part, and by having only a 8GB partition the drive head doesn't have to move as far as it might on a larger partition when accessing system files. Secondly, if you need to re-install for some reason you can just format that partition. When you re-install all your apps over the files already on your programs drive, they will pick up all your old save games, customisations, email and settings etc.
Oh, and having only an 8GB system drive makes it easier to do Ghost backups as well. Doing one a week takes 10 minutes.