That's exactly what I am saying. You boot into TM and restore to your internal drive - or your replacement drive in the case of a hardware failure. You can select the most recent backup or go back in time if you suspect a recent software install or OS update caused the problem.but did not know you can boot directly from the TM backup in the event of a total system drive failure (if that's what you're saying
Intel Macs don't like to boot from FW drives. Sometimes it works, often it doesn't. If your used a USB external, you would find it works. I use eSATA which is 5-6 times faster than usb2. A Time Capsule is very slow over wireless but faster than USB over Ethernet.
Same applies to optical drives. If you ever need to boot an intel Mac from an external, make sure that it is USB. The one that I carry in my tool kit is USB/FW/eSATA.