Yes, you can save backups on a Windows 10 USB stick that you've made bootable.
Yes, you can save backups on a Windows 10 USB stick that you've made bootable.
Sure, you can place your backup files in a separate folder on the same USB drive. Just ensure the backup is in a location you can easily access during installation. Using another USB stick is also an option if you prefer.
Backups to a USB drive will likely be very slow. Backing up to an old Barracuda ES 750 with the native Windows tool took hours—500 GB filled a drive that only handled 50 MB per second. It’s hard to believe a USB stick could ever keep up!
My backup of files and program exe's, only needs 3GB of space, for what I need to transfer. My other stuff is either on another hard drive or on a server/cloud. When I do a fresh install of Windows I always disconnect the other hard drives (so I don't delete them by mistake - done it before) Then only re-connect them when everything up and running.