OK, I am not very familiar with Win 7 (we don't use windows here) but the command must be issued from an administrator account otherwise the security built into win 7 goes nuts.
There may be something in XCOPY in win 7 that will override the security settings but how you would find that I don't know (help xcopy or xcopy /? in a command window might give all the options)
The other thing you should be aware of is that command will dump everything on drive C: to the NAS except, I think open files. Depending on what exactly you want to do (do you want a copy of everything including the operating system or just all your data files) there may be other options. For instance, we have disk images of clients systems so that if a disk goes down or we need to wipe the disk all we have to do is copy the image back to the disk and OS and programs are there ready to go, then we copy back the daily backup from the NAS and they are back in business ( the longest down time with that system was 2 hours and that was because we had to wait for a replacement drive to be delivered).
If you need a copy of the state of your disk there are several free disk imaging programs that will boot from CD and create an image file over a network to another device (NAS). Just remember that win 7 uses a small hidden boot partition so you will need to include that in the image.
If, on the other hand, you only need to backup your data you should make a batch file that has several xcopy statements for copying different root directories. For instance, the machine I'm typing this on has its working data files on drive F: so the xcopy for that is: XCOPY f:\* j:\f-bak1 /h/o/t/s/e/r/v and everything on drive F: is copied, but there may also be something that was downloaded to the download directory on drive E: so the next xcopy statement is: XCOPY e:\download\* j:\back1-down /h/o/t/s/e/r/v
I hope this may be of some help.