I am not sure I understand what you are talking about.
First, if you click on the link I posted, it tells you to type in 'cat [name of image] | gzip -d -c | ntfsclone ... etc., etc.
Where it says [name of image] is what I mean by "referencing" my image. Everything is on the same computer (which I thought was pretty clear from my OP).
You say that if I have space to restore an image you'd much rather go that way. What way? As opposed to what other way? This is where I get confused by your message.
Also, I never said I was going to erase my system. That is the whole point.
Finally, as noted in my OP, I am at work and cannot access the machine. I'll post more about the backup file folder structure and output when I try mounting when I can mess around with the computer at home.
For now, I am really looking for people's thoughts on the very simple question at the end of my OP.