i would like to make a few points in this discussion too, having some experience at this point with a file server too, which i set up about 2 months ago;
i did use a single, small (40G) and fast (WD raptor @ 10k rpm, 16MB buffer) HD for the OS. according to tom's hardware hd benchmarks at the time, the raptor scored quite high.
then i raided5 4x320GB of other WD drives for my data (for me its mostly music and sample files). This is for my data obviously.
i used software raid only - at the time and being rather new to the whole RAID in linux, i felt rather uncomfortable to add a fake raid, let alone the fact that i never managed to find out EXACTLY what the fake RAID 'gives' to the HW to do, and what remains for the SW... so i went ahead with the software (SW) RAID solution. - i let raidtools and mdadm handle my raid. all went smoothly. and the system for the file server that it is, works fine.
i was somewhat hasty though, i 'wanted' (and need for space restrictions in my 120GB 'old' data drive) to quickly set up my server and move my files there. i URGE you to be patient. setting up the linux server and depending on your level of expertise in linux (personally i had been introduced to linux 1 year before setting up the server, and i have been using the linux OS entirely for developing some applications and drivers, i also know how to make my own kernel - smth you'll probably have to deal with too)...
so to come back to the subject, be patient and take it slow:
-start by setting up a slackware OS with a single drive - i use slack11 cause it was the latest stable at the time. If you 're planning to use 12 keep in mind there is some important features that have been integrated in this version.
-once you have a STABLE system, with network running, etcetc USE IT exclusively if you must for a week or 2 just as a normal home pc doing simple stuff like surfing the net and dling and saving some files. (i had huge problem for 2 weeks not knowing what caused the numerous crashes kernel 'oops' messages i kept getting.. i was mislead to think that the hard drives where faulty (or the network card) because the crashes would occur everytime i was trying to save some files from the internet or the network. imagine having just set up a raid5 and getting this crashes.. you can't possibly assume that the problem is with the network crad driver instead with your limited knowledge of linux RAID
... so to sum up, enjoy this pc as a simple home pc for 1-2 weeks to verify it is STABLE.
-then comes the time for the additional drives. plug them in, see if they appear nicely. fdisk their partition tables, and use mdadm or raidtools for setting them up. once this is done again spend 3-4 days of using the raided space as a temporary saving space and go download the whole internet
make sure it works - we are talkin about your life's data here
.. once you are sure it works spend some time implementating destruction scenarios. ie do test aabout 1 drive failing and so use mdadm to remove it from the raid safely... then format it and add it back.. VERIFY that the raid will reconstruct the mirror (if you will use RAID1) on it. (there is a very nice HOW TO implement RAID in LINUX, so look for it in google, im too much of a slacker to go find it myself
-if thats done then you can finally COPY (not move yet) your data from your current data drive(s). switch to using the raided data at this point. but keep the old stuff intact for 1 more month or so.
meanwhile you might wanna start using some servers.. samba, ftp, apache, vpn or whatever other 'language' (=protocol) you would like your server to sing in...
finally you can use some backup utility like svn, rsync or other ( i think there are some more appropriate backup utilities for larger files, such as mp3 and photos are) to back up you raided data to your USB2 external HD....
at this point your should be fine, but depending on your level of expertise and the time you have available to set the server up you shouldn't try to get the file server up an running in 1 afternoon (more like a month
.. remember it's your life's work.
after 2 months i'm still 'setting' up stuff in my slack11 linux file server...
that's all for now
good luck with the project
anyway we can help, we are here
ps. have a linux in the linux server and perhaps linux hardware discussion forums too. in the former you'll find some info or how to set things up and in the later what does practically mean fake and what software RAID.