First, gotta check the man page on cp, they added a brilliant new command: cp -a. A -rf won't preserve file perms and ownership right and will skip dot-files and directories.
If you got a USB drive, built a special boot disk for the laptop that had all of the usb-mass storage drivers built into it, and as long as the entire fstab for the server is one partition so you don't have to monkey with the copy of fstab on the portable backup, then yeah, you could boot from floppy to a USB root device and then run the entire server off of a laptop.
A couple things to consider:
If this is USB 1.0, we're talking 1MB per second... think of that in normal ATA terms, 50 times slower than an ATA 100 drive... yipes, it would do in a pinch, but just barely. USB 2.0, no worries, but you'll have to upgrade the snot out of the RH7.1 server in order to support a 2.0 card, a spankin' new mandy on the laptop, no such problem, and if the laptop can't do 2.0 by itself, as long as it has a cardbus pcmcia adapter, a USB 2.0 pcmcia card is about a $50 problem... or really, not a problem.
There are a bunch of other ways to go about this though, an rsync backup on a daily cronjob to an offsite location is about the easiest. The first rsync would be the whole bloody drive, but the second would be only the differences between the two, much shorter... if your office has good outgoing its a solid backup measure. Also, it can be sent through ssh if there are security worries on your boss's end.
Also, why a laptop, most modern day mobo's can boot off of USB (actually, so can the laptops), so you could theoretically turn any available crate into the server in short order.