Since it's 1 TB in size, it's almost certainly a SATA drive. You can crack the case open and find out for sure, but make sure you're okay with voiding the warranty (if it's still under warranty). Unfortunately, many external hard drives have concealed and/or tamper-resistant (i.e., nonstandard) screws, so it may not be possible to open the enclosure without breaking the plastic or drilling out the screws. Then again, it is possible to purchase screwdrivers that can remove certain types of tamper resistant screws (such as Torx drivers with a hole in the middle of the Torx head). If you don't want to use the enclosure again, or if you don't care how it looks afterward, this might be an option.
If you don't want to void the warranty and/or you need to reuse the enclosure and want it to look as unmangled as it does now (but can't find the right screwdriver to remove the tamper-resistant screws), you might want to buy a new internal drive instead.
The backup tool for Windows 8 has changed. If you want to backup just your user files, you want to use File History, which will automatically synchronize your Libraries and backup to an external location. However, File History cannot backup your whole system, including applications. File History is suitable for making backups automatically in the background, even while you are using your computer.
To backup your whole system, you want to create a restore point. This will make a copy of your entire hard drive, including system and application files. This is not automatic. If you need something better, you will need to look for a 3rd party application.
I would not recommend storage spaces, because some issues in it means that it does not appear to provide some of the benefits we would like. Windows storage spaces is not a backup solution. It is a way to store files on multiple hard drives, as if it was a single storage space. It allows you to combine multiple drives (of different sizes) into a single storage space, as well as to resiliently store files (in case one of the hard drives fails). However, if you only have 1 hard drive added to the storage space, the read/write speed change.
This is because RAID increases the speed of read/write by doing these in parallel over multiple hard drives.
If you used multiple external hard drives (at least 2), then the read/write speed may change. However, Windows 8 Storage Spaces does not allow you to control exactly how the data is distributed, and therefore how read/write speed changes directly. You can only control how many drives are available, and the resiliency type (for the same hard drives, a lower resiliency will have higher read/write speeds). To be sure about read/write speed, you would need a formal RAID configuration - however that requires hard drives of equal sizes. In addition, it appears that Storage Spaces is actually slower for most configurations, than a bare hard drive. Obviously, writing is going to slow down. However there appears to be no improvement in read speed (where we would expect an improvement).
For more information on Storage Spaces, check this article.
File History and Storage Spaces can be used together to backup data resiliently.
Best Answer
Your drive isn't being detected as a "USB drive", it's a device with hot plugging enabled (which USB devices also are). You can disconnect the hard drive by Safely Removing it and unplugging it while the computer is on.
My mainboard lets me turn this on and off for individual SATA ports. Some have a master switch for the whole SATA controller, and yet others don't let you toggle it at all. In this last case you can sometimes switch your SATA controller drivers to disable the feature, but it's not actually harming anything to have it on. Windows won't let you unmount your system drive because there are too many important files open and locked on it.