You don't have to have a seperate /home. You can create an archive of it at any time. Or move it to it's own partition after installation. It really depends on how you're going to use your setup. For me on an old laptop with a 30GB HDD and 512MB of RAM, that I use primarily for youtube, hulu, email, this forum:
/dev/sda1 - 6GB - alternative bootable linux / recovery linux
/dev/sda2 - 4GB - swap / alternative other bootable linux
/dev/sda3 - 20GB - my primary install and working linux
But I'm not doing much on it. Aside from freeing up the desktop to do gaming / needy work and using the laptop for media consumption while I wait for that stuff to complete. Without slowing that machine down by doing it all on one machine.
Recently I've been toying with using multiple users that share the X environment. On my other machine. One user for gaming. One user for IRC. One user for web browsing. A little tedious to copy the .Xauthority of the user that started X. And setting the DISPLAY and XAUTHORITY vars for each user. But useful in that the disposeable users (gaming) require no sifting of the /home contents before sending them to the circular file. Since games like runescape can cache over 1GB of data to your /home. And varous browser cache and ~/.java or ~/.adobe type fluff that hogs a lot of space for stuff you probably don't care about.
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