How do I change the backup drive in itunes?

See Relocate iOS device backups. Review the rest of the Make a split library portable user tip for advice on organizing the library on external storage.

Note iTunes still checks the available storage on the C: drive so there must be enough room for the backup there, even if the data is going to go onto the D: drive.

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The location of the Backup folder varies by operating system. Though you can copy the Backup folder, you should never move it to a different folder, external drive, or network drive. For more info, see:

Locate backups of your iPhone, iPad, and iPod touch - Apple Support