This is not on your hard drive. It's not taking up any of your hard drive space.
According to Disk Management, your main hard drive is a "500 GB" drive. The size is in quotes because to the drive manufacturer, 500 GB = 500,000,000,000 bytes. Windows, on the other hand, uses "kilobyte" to mean 1024 bytes; "megabyte" to mean 1024 KB; and "terabyte" to mean 1024 GB.
Thus,
500,000,000,000 bytes / 1024 = 488,281,250 KB
488,281,250 KB /1024 = 476,837.16 MB
476,837.16 MB / 1024 = 465.66 GB
Thus, when Disk Management shows 465.76 GB, that translates into an approximately 500 GB drive in drive manufacturer measurement.
The three partitions shown on your hard drive total 465 GB, including 186 GB for your system drive and 254 GB for your data (which is almost unused; you probably haven't relocated your User data files yet. see http://www.techsupportalert.com/content/how-move-windows-7-personal-folders-my-documents-another-drive.htm).
It looks like you also have a 2 TB WD My Passport Ultra and a 500 GB WD My Book attached as external drives.
My guess is that the "Z Drive" has something to do with Western Digital's SmartWare automatic online backup, especially given that you have the SmartWare CD in your CD drive. As an experiment, disconnect your computer from the Internet and then reboot. Is the Z drive still there?