How best to test backup?

I am running Ghost 10 with windows XP

 

I backup my internal HD to an external drive

 

Once a month (at the beginning of the month) I create a new reference point

Every workday I create an incremental backup  - manually

When I start running out of space i delete the oldest backups to make room for new ones.

 

What is the best way to do a bare metal recovery to ensure that the backup functions perfectly?

My current idea is to insert a bare HD into the notebook and do a restore - check for all files and functions. (I will get a little tech support for this)

 

I would welcome input on the backup method and bare metal recovery - thanks