You can force TM to use less space by limiting the amount you let it "see." Use a volume that is already heavily populated with files, create a partition with only a few hundred gigabytes, etc. It will start deleting back-ups when it thinks the disk is full, which is simply when it can't create a new back-up because of not having enough space. I think of it as a "historical" picture of almost everything I have (or had) on the drive as far back as the space allowed will accommodate.
Actually, each hours back-up takes very, very little space. It only has what has changed in the last hour. Although it will
display the entire disk (or whatever you've asked it to back-up), it is all done with smoke, mirrors and a little software. Basically, all the previously backed-up stuff is elsewhere on the disk. What you see is similar to a bunch of aliases. If you haven't created anything in the last hour, the new "back-up" is basically just another file pointing to the same ones that were on the previous one. Quite efficient use of hard drive space, actually. It's not simply another complete copy of what's on the drive at back-up time.
SD, on the other hand, has the advantage of being bootable (in case you can't find your install disks). But if you select the first two types of back-ups (During copy), you will lose any files that were on the old one but not on the drive at back-up time. And the last two choices will over-write any previous file that has changed. It's not what I would call a "historical" back-up. It may go back quite some time for a particular file that hasn't been changed since it was first saved, but any others will either be over-written with the change or simply deleted. It's more like a "snapshot" of your drive at a moment in time.
So far, we have a choice as to how we use these two different methods. But, in all fairness and honesty, everyone should do everything as I dew!
Or, at least like Steve says!