Run the Gnome Disks utility from the Ubuntu programs menu. Select the 120GB Disk, and then choose “Create Disk image...”. Create a file name for the image. Create the Bootable... · Boot from the Installation Media · Backup to a Disk Image
This command creates the drive image and then passes it through gzip for compression. Bzip2 could be substituted instead of gzip for greater compression.
You can create a recoverable backup of essentially your entire installation without having to make bootable media. You just open terminal and run a command.