I would suggest plugging in the 60 gig as the Primary Master hard drive.. then plug in the 20 gig as the secondary IDE slave. (second notch in the middle of the cable conenctor). Make sure you CHECK the jumpers on both drives to make sure htey are set right. When you first boot you will see them both display on the boot screen right away as primary and secondary fixed disks.
When you partition and format that drive. the thing I did was make a 2 gig partition just for the OS (windwos).. then I put the rest of the space as one big lump. Reason for this.. is if you ever need to reinstall windows you can just format that one partition and not lose anything or worry about losing all your things.
Once you have it partitioned.. then isntall windows on the 2 gig partition and once you areup and running you can copy anything off of your 20 gig drive you need.
Then you can format your 20 gigger.. and use it as a backup drive.. or a storage drive etc.
Definately good to try and keep the OS on a seperate partition though.. keeps things simple and more clean that way.
And good luck bud