The backup file was about 3 GB.
Backup completed ok except for backing up a few antivirus folders.
Not sure about the external USB drive formatting. It is a 500 GB Western Digital formatted to whatever is the default.
Since listing the question, I restored the backup to a single folder on the same external USB drive that contains the bkf file and although I still got the message to "insert media #2", I believe that most of the files were restored. Then I copied the restored files back to the original C: drive. The friend I did this for has not complained about any missing files thus far, so I will not worry about it :).