I did some research on external hard drives. Much has been made of USB 2.0 and Fire wire 400 drives. I read the specs thinking I was miss-reading things but I was not. I am getting a 50+ MB sustained transfer rate from a LaCie 400 gb external SATA drive (according to my bench with various configs)- Truly remarkable considering the large capacity. Now, the seek time is about 11ms (usually not so good - as a good baseline for audio apps is about 7 or no more than <9 ms). However, this is where having the 8MB cache can come into play and to some extent negates the relatively high seek rate. It sure is streaming samples without a hitch!
On the smaller (and usually faster) drives, USB 2.0 and fire wire 400 come in at about 30-40 MBps. The fire wire 800 drives are faster at about 60+ MBps (but only the latest MB support fire wire 800 so keep this in mind) – and again these are the 80-120GB drives.
External SATA drives require an extra step in that you have to install a SATA PCI card (making them a tad less mobile). But having such large capacity for back-up and also the ability to actually use the drive makes it well worth it in my opinion.