Yes you can put an image on a different HD of different size. I use EaseUS ToDo backup server edition but that is not free. If you are not using windows server you can use their free edition here.
Just put both drives in the comp and make an image (not the clone option but backup disk) of the whole drive and restore it to your new drive, assuming you have less than 120GB of data on your old drive. The program will detect the different drive sizes and let you make partition adjustments. Make sure your new drive is set as the first boot device in the BIOS and off you go.