start small... (Score 1)

I had a similar situation last year and decided to use a NAS appliance that supported USB2.0 expansion. This way I can start with the internal 160gb drive and grow with in expensive USB2.0 external drives. Additional drives are hosted by the NAS functions transparently giving easy expansion through the years. My cost for the NAS with 160gb was ~$230.

In contrast my brother-in-law just built a file server with four 250gb SATA drives configured in RAID-5. He bought all new equipment, motherboard, processor, gig of ram, drives, power supply case, etc... He spent considerably more then my $230 (over $1100) but he now has a terabyte at home. It was important for him to have not only the file storage but a location for server type applications to run.

I could have purchased a terabyte NAS for $870 or so but I didn't see the need. The only downside I have found with a NAS is with my laptops. At home they can connect up to the NAS and get access to my photos, music, documents, etc. On the road however, they are not very useful. I've now had to start classifying what information I need with me at all times, and what things I can live without. If you have a VPN solution that will allow you to access your home network at a decent speed this may not be an issue for you.

Having data on a central server also has implications with the software you use. For example you will need to decide where iTunes stores downloads, local or on the NAS? If it is on the NAS then you can only download new music when you're connected to your home network. My best recommendation to you is to look at how many people access the same data in your household and use this to identify who would be effected if they didn't have their data with them all the time.

One more option is using your NAS primarily for backup. This reduces most of the concerns above.