I'm running the 1.3.3 Win32 build (http://savannah.nongnu.org/download/rdiff-backup/rdiff-backu...). It is supposed to handle NTFS ACLs but I haven't looked at it in-depth because my, for my application, I don't need ACLs to be preserved.

I wouldn't think rdiff-backup on Win32 is suitable for an OS backup. I'm backing-up a particular application's directories only, so I can get away with using it.

The built-in Windows Backup's image-based backups are reasonable (at least in Windows 7, 8.1, and Server 2008 R2 and 2012/2012 R2-- I haven't tried it with other Windows versions). You get a VHD file (VHDX in Server 2012) that can be mounted, as you say, in Virtualbox, etc. I suppose it would be bootable, but I'd never thought to try that.

"Previous Versions" is a user friendly interface to Volume Shadow Copy (VSS) that takes periodic snapshots of a volume and presents them in a GUI. Data for "Previous Versions" is stored in the volume that's subject to snapshot.

Windows Backup also uses VSS snapshots to maintain multiple versions of the backup. These snapshots are stored on the backup destination, however. I think you may be conflating the "Previous Versions" feature's use of VSS with Windows Backup's use of VSS.

To access the VSS snapshot versions of the VHD(X) file directly that Windows Backup creates it's necessary to expose the shadow copies (using a variety of different methods-- "diskshadow.exe", or "mklink.exe" being the two most common). You can also use the GUI restore interface to restore files from a previous snapshot of the VHD(X) file.