Hyper V 2012 Backup - best practice

I'm setting up a new Hyper-V server 2012 and I'm trying to understand how to best configure it for backups and restores usingWindows Server Backup. I´ve 5 VMs running, everyone has their one iScsi drive.

I would like to backup the VMs on a external usb disk. I´ve the choice to backup the Hyper-V using child partition snapshot or to backup the vm folder with the config and the vhd files (is is right, that Windows override the old backup ?)

What´s the difference between the two methods ?  Is incremental back possible with vm´s ?

thanks