Best Backup Strategy for Alternating external drives?

Under Windows XP Pro I used the built-in Backup functionality like this:

• I'd backup to two external drives, and use alternate drives for alternate backups. So Backup 1 would be stored on External Drive A, Backup 2 on External Drive B, Backup 3 on Drive A etc. etc.
• Use the option to backup System State information (which saved me more than once when System Restore failed). These were less than a Gb
• Create full (rather than incremental) backups of my files from specified folders. Some folders were within XP's C:\Documents and Settings but some would be on other folders or drives on the computer.
• Use the option to selectively restore files from these backups where necessary.
• I had a full image taken when the computer was new, for when things really went wrong

I want to keep the approach of alternating where I store my backups, as it gives an extra layer of protection.

However I don't know how File History or indeed "Windows 7" Backup would cope with me alternating the drives, as my understanding is that they try to create incremental backups and I don't see that working well because no one drive would have a complete history.

I don't want to backup the whole computer every time; it's too big and there's stuff I don't need to backup (or I'm happy to backup in other ways)

So should I use File History or W7 Backup, or a 3rd party alternative?
(I've tried Paragon Free Backup and Recovery 2012 which isn't bad, but I found that doing a selective restore takes beyond forever to complete.)

Also, what is the nearest equivalent of the old XP Backup of System State? Could I use the RECIMG command to create backups of the system software etc.? How big are the images and how reliable is the Refresh process?

Thanks in advance for your help.