OK - clarification !
DVDs come in two capacities - single and dual layer. Single layer DVDs hold about 4.5 Gb of data on one layer and are cheap. I buy mine in batches of 100 because I ship a lot of data around and they cost me about £ 15 / 100. Dual layer DVDs hold a little more than 8 Gb but are relatively expensive - about 40 or 50p each, again buying in lots of 50.
Tb is the standard abbreviation for terabyte and is equal to 1000 Gb (gigabytes). Or equivalent to about 225 single layer DVDs !
There is a wonderful utility in Windows called Windows Explorer for managing and moving / copying / deleting files, I use it intensively! Since you have Win 7, you probably have an icon for it on the taskbar, usually between Internet Explorer and Windows Media Player. If you don't, right click on the start button then click on 'Explore' in the small pop-up menu. You can make the Explorer window any convenient size.
I have my Win Explorer set to the 'List' option wherever it will allow me - at the top right of the window you will see a symbol with a drop down arrow beside it. If you click on that, 'List' is one of the options. If you then go to 'Organise' at the left hand side you can choose to set all windows of that type to open in 'List'.
When Win Explorer opens, the default view is looking at your libraries. If, like most people, you keep your documents in 'Documents library' and your photos in 'Pictures library' and so on, if you right click on each library in turn then select 'Properties' from the pop-up menu it will tell you the amount of data in that library - 270 Mb, 3.5 Gb, 183 Gb as examples. This will give you a good idea how much storage you need. See post #9.
If your data is not in the libraries - and mine isn't - go and do the same to the folders where you do keep it.
If you decide to use either USB memory sticks or a USB connected external drive for back, then Win Explorer is your friend. Insert the USB drive into a convenient socket and let autoplay do its thing and stop it. Start up Windows Explorer and you will see the drive you have just plugged in. Then you just use 'drag and drop' to copy the files and folders you want to back up to the external USB memory.
'Drag and Drop' - If you are not familiar with this. First open Win Explorer then find a folder (or a file) that you want to back up. Click on it and hold the left button down, then move the cursor to the external drive you want to copy it to, keeping the button down all the time. You will see that the folder moves with the cursor. When you have the cursor over the external drive which is your target, release the button and the folder will be copied into it. This is easier to do if you have your computer set to Classic view rather than Aero because you don't get the large blurring box around the folder when you move it, but the difference is small. This process COPIES files and folders, the original is left where it was and a copy is placed in your backup.
If you decide that DVDs will meet your needs, you CAN use Win Explorer to 'burn' them, but I find it 'clunky' and inflexible. For simple data backups I prefer to use CD/DVD burning software like 'Free Easy Burner' which is a free download - google for it - but there are plenty of other choices.
Start the burning software, put a DVD in the drive and it will recognise it. Then make sure that you have selected 'Data DVD' as the output type and you will have a screen to add files and folders to the DVD. Browse for the folders you want and add them to the list, up to the capacity of the DVD, then click 'Burn'. You will then get a screen where you set the burning conditions, normally just accept the defaults, and click 'Burn now' and it will start to burn the data to the DVD. A full 4.5Gb of data takes about 7 or 8 minutes to burn, time to put the kettle on.
And that is backing up data in a nutshell. There are other ways of doing it, as I said you can make a complete image of a drive, but that is the simple way of making sure you have your data backed up.
You made some remark about 'files and folders' all over the place. This is going to make life a bit harder for you. If you really want it I will provide my lecture on organising storage another day, but don't get me started on that! I have strong feelings on the subject that if you go to the effort of saving a file it is because you may want to refer to it in the future, which means being able to find it again !