So, do you have another RAID array in this system? If not, then I'm not sure where you were hoping Dell would put the system partition. It is not a recommended practice on Dell controllers to have multiple arrays across the same set of disks, so they would not have done it any other way - it would be just as ordered.
That said, you cannot expand a RAID array on a PERC controller in that manner (adding larger disks one at a time). The only way of "expanding" the size of a Virtual Disk, is to add drives to the configuration, for example, you would reconfigure your 4-disk RAID 10 to a 6-disk RAID 10.
Once you have created a larger Virtual Disk, then it is a matter of making you partitions bigger. To do that, you will need a utility that can handle the job. There are "pay" utilities, like Acronis Disk Manager, that can resize partitions while keeping data intact. There are some "free" utilities, but most of them can only extend C into Unpartitioned Space, meaning you will need to backup your data partition(s), delete them, extend C, recreate data partition(s), then restore. You can use Dell's ExtPart or a Server 2008/Server 2008 R2 DVD to do this.
Whatever you do, make sure you have a backup before attempting any resizing, as there is no risk-free way to resize a system partition in 2003.