ARGH! Was hoping that the new OS update would resolve the Full Backup issues with the Playbook when you have a lot of apps installed! To troubleshoot, I installed my apps in batches of about 10 until it crashed when the backup file size reached around 800MB.
What's weird is that I then uninstalled the previous batch of apps to see if I could perform a full backup but it wouldn't let me! Strange.....the problem appears to be with the Desktop Manager though and not the Playbook itself. Hopefully a DM update will come along soon!