Mh, I have two separate backup files, "DbName.Bak" and "DbName_Log.bak". Each Sunday evening, when I run the Full backup, I add the WITH INIT command, which completely empties the file. You are correct that this can be thought of as truncating, but usually that word is used for the logfile, which is truncated whenever you do a Full or Differential backup of the database itself (not the log).

Mon - Sat I do a differential (which truncates the log), but this one does not INIT or empty the "DbName.Bak" file - instead the Differential backups append, so the "DbName.Bak" file grows each night until Sunday, when it is emptied with another INIT. I can look at the contents of the backup device and see a backup for each day starting at Sunday evening, through last night.

The log backups go into "DbName_Log.Bak" every 15 minutes between midnight and 7 pm. The job that runs the Full or Diff at 7 pm also runs an INIT on the "DbName.Bak" file, so it starts out empty at midnight, all 7 days. This means that during the day I can restore to any point-in-time, but if I go to a previous day I can only choose the 7 pm marks, which seems like a resonable compromise.

I hope this helps. Let me know if you'd like some example code to set up your jobs.