/etc MUST reside on the root partition. If you move /etc/ to another partiton, assuming the OS lets you, you will have a non functional machine.
The basic quick and dirty of it is this:
Inside the Linux boot process
The bootloader then needs to know where your kernel and when the root filesystem is.
/boot does NOT have to be a filesystem. It can be a directory on the root partition. You should have a look at this:
http://www.pathname.com/fhs/