Backup Utility is backup data saved on the hard disk to storage media.
Check: http://manuals.playstation.net/document/en...kuputility.html

Data Transfer Utility is transfer data that is saved on one PS3 system's hard disk to another PS3 system's hard disk using an Ethernet cable.
Check: http://manuals.playstation.net/document/en...ferutility.html

Please take note, both menthod can't backup trophies. Need to sync with PSN server first. After get new console or new HDD, sync again with PSN server, all trophies will show up in new console or new HDD.

If want upgrade HDD to bigger capacity at SAME console, then use Backup Utility method. This method backup everything in old HDD and restore everything to new HDD except trophy information. Don't need deactivate PSN account with this method.

If want transfer data from one PS3 console to another PS3 console, then use Data Transfer Utility method. This method transfer data in "old" console to "new" console except trophy information (there still some limitations, please refer user guide above). Backup Utility can use to restore some data to "new" console too, but not everything, especially copyright-protected save files can't restore at "new" console. And advisable to deactivate "old" console because 1 PSN account can use in 5 different PS3 console only. If PSN games bought from share PSN account, then the share PSN account MUST deactive first in "old" console and activate it in "new" console in order to play those PSN games in "new" console.

If use backup method to "NEW" console (not SAME console), you can't get those copyright-protected files. If use transfer method, all copyright-protected files will transfer to "new" console. Last time, I transferred data from PS3 Phat to PS3 Slim, no any lost data happened.

No. you can select "copy" or "move" during transfer process.

Yes, including PSN games. Need re-activate the account if those PSN games bought from share account.