What error message/s are you getting?
Is your external drive being recognized?
Have you tried running the backup in XP compatibility mode?
Have you updated your Truecrypt driver?
Found this on the Truecrypt website:
Does TrueCrypt support the 64-bit editions of Windows 7/Vista?
Yes. Note: The 64-bit TrueCrypt driver is digitally signed with the digital certificate of the TrueCrypt Foundation, which was issued by the certification authority GlobalSign.