I've got an 8Gb Gentoo virtual machine that I'm working out a backup
plan for. Since the disk space is pretty small, I'm thinking about just
taking a full image of the disk for backups, rather than cherry-picking
DBs, mail, etc.

I'd like to take a full image every day (but only transfer the
differences), which I'll store for a week. Does this sound like a
reasonable enough approach?

Any suggestions appreciated,