Hi,
The largest drive (or at least largest part of a bigger drive) that can be used on an unpatched 3.0 or 3.1 installation is 4Gb, with a maximum partition size of 2Gb.
The internal hard drive port in a A1200 is definitely IDE, though the Amiga deals with it via "scsi.device" and the system tools see it as a SCSI drive - this may lead to confusion!
Your existing A1200's hard drive cable should be fine with a different drive.
Backing up is a pain if floppies are all you've got!!! You might be better off getting a 2.5" to 3.5" adapter, or maybe a USB to IDE adapter - and do the backing up from within WinUAE on a PC.
Alternatively, you could try networking your Amiga, or if that's not possible, at least one of the parallel port or serial port solutions to use a PC to store the Amiga's data temporarily while you're swapping drives.
Some more info on hard drive installation can be found
here.
- Ali