Try making a
Fiddle for us to see.
Positioning things with CSS is rather counterintuitive (stupid box models). So when you declare a width of 400px and a left padding of 60px, you're actually defining the element size as 460px. (To get around this, you can actually set a -webkit-box-sizing: border-box; rule, though I'm not sure how well-supported that is; there's also a -moz- version too, at least.)
So yes, what you're doing is, at least according to the specs, defining your element's content to be 400px wide, then you add 60px space to the left of that content, and the background image should span all of that, up to the borders. It can be quite confusing, yes. You'll get the hang of it. What you're doing is pretty much the "right" way.
@Xanthir: I think he's trying to place HTML text that's pushed slightly to the right, and overlaying that on top of an image. Like
this. Presumably the background image involves something on the left of the text.