Old windows laptop as Time Machine "capsule"

Hello,

I am considering using an old windows XP as a time machine capsule (with a large external HD connected to it) And I was wondering if there are any issues with this that people can think of.

It would be connected to the network via an ethernet Cable on a Squeezebox media player which then connects to the rest of the network via Wifi (apparently this player has a Bridge function allowing other devices on its Ethernet port to bridge to the wifi network)

1) Would the mac use this windows laptop’s HD as a time machine volume? I guess I would have to set up some form of home sharing.
2) I need to backup over 1.2TB of data. I have heard that time machine mustn’t be stopped such as sleeping the PC on it’s first backup. Is this true? As I can imagine it would take days to make the initial backup. The last time I backed up this volume on my PC was with a SATA connection and it took 19hours then.

Time Machine needs to have a drive formatted as HFS Extended Journaled and using the GUID partitioning scheme. The WiKi gives a good explanation of requirements. LINK

Thanks for the reply. It does seem harder than I had anticipated. I am wondering if maybe just dishing out for a Time Capsule now is the best option. I didn't really want to spend all that money, but maybe it is the best option.

The only catch is one that surprises me with Apple. Apple suggests that a time machine backup should be double the size of what you wish to backup. Since my iMac has an SSD (256GB) + 2TB HD, the 2TB Time Capsule isn't enough really. So I have a question here.

* Is it possible to upgrade the Time Capsule HD with a larger one, say the new 3TB HD's that are currently on the market?

I guess I could whack an extra external drive through the USB port onto the time capsule, but this starts to become messy as I would have two devices with two power cables and connected, plus of cause the extra power usage.