Thanks for the input!
I don't think it'd be possible to use a different size drive for my needs, as it was a truecrypt encrypted drive, and the only way truecrypt knows where the backup header is located is by counting the byte offset (it appears as random data until it inputs the password you enter). As you suggested I probably could use a hex editor to manually copy and paste the end header, but I don't know if changing the number of sectors in between the header would have an effect on how it decrypts.
Long story short I decided against the full clone since I read it often doesn't work anyway, and tried mounting the drive. I'm using a hex reader to recover what I can from the unencrypted container and then I'll try letting truecrypt attempt to recover the file structure (don't want to risk further corruption if recovery fails).
Thank you for chiming in. I'll be changing my backup strategy so hopefully if this ever happens again I won't need to recover anything, as my backup won't be a month old.
You can clone a bigger drive unto a smaller one. All you need to do is to leave some unalocated disk space by deleting or shrinking a partition, but ofc the unallocated space must be enough so that the space of the source drive is equal or smaller than the space of the target drive. Unallocated space won't be taken into account when cloning.
With Windows 7 you can modify partitions without 3rd party programs. Just go to Control Panel>Administrative tools>Computer Management>Storage>Disk Management. You will figure it out from there, it's quite intuitive.