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Thanks for the advise. I tried to repartition and reformat, but sadly the capacity is stuck at ~73GB :( Tried deleting the Master Boot Record as well, but the drive is still reported at the lower capacity...
The idea of transferring the old C drive as an image onto the new drive sounds very promising. I will be sure to try it out, as soon as I get the drive up and running again.
Believe it or not, this sounds normal. Here's what you should try:
Start over. Repartition and reformat the external drive. You will now have the entire disk available.
Then instead of using copy partition>partition, use partition >image. Select the external drive
as the image location. The image will look like files to the drive, and the remainder of
the drive will be available for whatever.