Creating multiple libraries and using an external drive for data

I'm a recent switcher and new to iphoto. On the windows platform, I used adobe album. I have a around 10k of images that I put on an external drive which is attached to my new imac. I deleted the iphoto folder and redirected it to my images on my external. All is working great. I'm looking for some advise on work flow of file/iphoto management. i.e. I'm assuming the more images I accumulate, the slower I photo is going to run? I hear you can create multiple iphoto libraries. Will that only load the photos that are associated with the library and I'm assuming optimize iphoto's performance versus always loading every photo you have taken every time you work in iphoto? If adding libraries is the way to go, can someone direct me to instruction on how to do this?
This may be beyond this threads scope but I plan to put all my data (iphoto, imovies, itunes) onto an external drive in order to keep the imac main drive as clean a possible. Is my thinking correct in doing so. Any negative repercussion in doing so?

Joe:
I'm assuming the more images I accumulate, the slower I photo is going to run?
You'll have to get quite a lot of photos into iPhoto before you start to see a real slowdown in performance. Users have reported libraries of 40K files and they perform just fine. However, do not keep all of rolls open as that will really do a job on the performance. Just open the rolls you need and close them all before quitting.
Yes, you can use multiple libraries and only load what's in each. I use iPhoto Library Manager to manage and move quickly between 10 libraries. With the paid version of iPLM you can move albums and/or rolls between libraries as needed and keep the keywords, ratings, and comments intact.
Using an external HD in order to maintain sufficient free space (10G minimum is what I recommend) on the boot drive to help optimize performance is a very good idea.
As far as any negative aspects, it would be a good idea to have a second external HD as a backup to the working external HD. You can't be too careful with those image files (and other important files) that can't be replaced.
Do you Twango?
TIP: For insurance against the iPhoto database corruption that many users have experienced I recommend making a backup copy of the Library6.iPhoto database file and keep it current. If problems crop up where iPhoto suddenly can't see any photos or thinks there are no photos in the library, replacing the working Library6.iPhoto file with the backup will often get the library back. By keeping it current I mean backup after each import and/or any serious editing or work on books, slideshows, calendars, cards, etc. That insures that if a problem pops up and you do need to replace the database file, you'll retain all those efforts. It doesn't take long to make the backup and it's good insurance.
I've written an Automator workflow application (requires Tiger), iPhoto dB File Backup, that will copy the selected Library6.iPhoto file from your iPhoto Library folder to the Pictures folder, replacing any previous version of it. You can download it at Toad's Cellar. Be sure to read the Read Me pdf file.

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