Remove the old internal drive at the same time.
Fit the new drive and reboot tapping F2 or the Del key or whatever key takes you into the bios.
Make sure the primary boot is the optical drive as first boot and then put the Windows 7 disk in the drive and press F10 to save the settings and exit.
The screen should go dark momentarily and then you will see the message "Press any key to boot from cd".
Windows will then start installing and will reboot occasionally and you will see that message again but this time PRESS NOTHING but simply let it install.
Once Windows has fully installed shut down and attach the external drive and reboot.
Go into Control Panel / Backup and Recover and click Restore My Files.