Optimum HD setup for Server on Mac Pro

We are currently running Tiger Server on a Dual 2 G5 and are preparing to migrate to Leopard Server on a new 8-core Mac Pro (I wanted an Xserve, but given the tight purse strings lately, will happily settle for the Mac Pro!!). I will be doing a clean install and then migrating settings, accounts, etc. over to the new machine. I've been trying to figure out the best hard drive setup, but have quickly become confused by the overwhelming abundance of (and occasionally conflicting) recommendations out there.
I've seen some who swear by a RAID 1+0 set up {two sets of mirrored drives that are then striped...or is it a set of striped drives that are then mirrored?!? You can see my dilemma...}, while others swear off of such a setup; lots of STRONG recommendations in favor of a small OS disk and second data disk (perhaps a solid state drive for the OS and a regular drive for the data?); even recommendations for multiple drives with 2 partitions that are RAIDed in ways that made my eyes bleed just trying to figure them out.
Bottom line: what would you recommend hard drive wise for a Mac Pro that's going to be a primary server for a small private school? Assume anything is possible (within reason--obviously a 16 bay external RAID is out of the question), and, if possible, include specific drive recommendations (I've seen LOTS of posts steering me as far away from Seagate as I can get because of high failure rates / firmware issues...any thoughts on the WD Caviar Black vs. the WD RE3 Enterprise?).
Thanks in advance for any help you can provide.

There are so many conflicting recommendations because there are so many valid configurations. Not every option is right for every case, and you need to consider your own use case to determine the best option.
Let's start off with:
I've seen some who swear by a RAID 1+0 set up {two sets of mirrored drives that are then striped...or is it a set of striped drives that are then mirrored?
RAID 1+0 is a series of mirrored sets that are striped together. This contrasts with RAID 0+1 which is sets of striped disks that are mirrored. The difference is subtle but there are slight differences in fault tolerance and performance in a degraded state (e.g. when one disk has failed).
lots of STRONG recommendations in favor of a small OS disk and second data disk
That is sometimes preferred, although it does depend, again, on usage pattern. If you expect to have a lot of data access then this can be advantageous.
Bottom line: what would you recommend hard drive wise for a Mac Pro that's going to be a primary server for a small private school
A 'primary server' doing what?
Open Directory authentication: doesn't matter since disk is barely used, so any RAID format is going to work equally well, as well a non-RAID setup with a good backup process.
Home Directories: This may benefit from separating data from system, but you need to consider how much disk space you need.
Network Services (such as DNS, DHCP, NAT, etc.): Doesn't matter since disk is irrelevant for these services.
Other services: You need to be specific about what this server is doing in order to determine the best disk setup.
Assume anything is possible (within reason--obviously a 16 bay external RAID is out of the question
Well since you mention that, what IS the limit?
Most specifically, if you're considering external arrays, what is your goal as far as capacity is concerned? You can get external arrays from 500GB to silly numbers of petabytes depending on how much you need and are prepared to pay.
Also if you're going external, once you go over 4 drives, neither RAID 1+0 nor RAID 0+1 is ideal. You'd more likely be looking at RAID 5 which yields a better usable space ratio.
RAID 0+1 and RAID 1+0 both require 2n disks for n capacity - e.g. to get 2TB of usable space you need 4TB of disks). RAID 5 uses an n+1 ratio, so those same four 1TB disks would result in 3TB of usable space). RAID 5 has an extra processor overhead, though, so generally requires specific hardware such as a RAID controller rather than leaving it up to the OS.
include specific drive recommendations
If you want to sleep at night, whatever drives Apple supply.
Sure, other drives will work in the Mac Pro, but for sheer reliability in a server, stick with Apple.
If budgets don't stretch to Apple-branded drives then just about any enterprise drive will work fine (don't try to skimp on cheap desktop drives since they're not designed for server loads).
I've seen LOTS of posts steering me as far away from Seagate as I can get because of high failure rates / firmware issues...any thoughts on the WD Caviar Black vs. the WD RE3 Enterprise?
Seagate really screwed up last year with a firmware bug (and, more importantly, how they mis-managed the solution), but that's history now, except for the people who got bit and have long memories. Consequently they would be on my list of vendors if I were buying non-Apple drives.
The Caviar Black is a desktop drive, so nix that. The RE3 would be OK.
Also bear in mind that if you are looking for an external enclosure (so you can handle more data than you can put in the server), many enterprise RAID solutions have their own limitations on drive support so you might need to consider that before you buy any drives.

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