Question on use of external drive for /Users

I'm rapidly running out of room on my 2nd internal drive which is setup as the /Users drive - it's the stock 160GB drive. I also have an external Lacie 250 being used for backup of both my boot drive and the user drive. I figured I'd just replace the 160 with a 300 internal, but I'd hate to leave a good drive sitting around doing nothing! So I'd end up buying an enclosure for the 160 as well and use it for my recent forray into video.
Since I want to do this for the least ammount of money possible, as I've already spent more than I should recenlty on upgrades, I thought I'd just leave the 160 internal and buy a 300 or 250 external for the user drive. I've read on the forums that external speeds suffer greatly, but will this make a difference for the user drive? All applications are installed on the boot drive, BTW.
If the conclusion is that the external would be fine, the other question is what interface? I currently have the Lacie on FW800 and would love to add another FW800, but that would require daisey chaining the 2 and I've read here that this causes major problems - especially since one would be backing up the other. I could move the backup to FW400 since I have nothing there currently - don't think I'd see a performance issue there since it backs up in the wee early morning hours. Of course theres always USB 2.0 and I could probably get a cheaper drive with that interface - maybe.
Again, cost is an option currently, so keep that in mind with your suggestions. TIA
Anthony

I've thought about that. Although most of the "good" enclosure's I've seen go for more than $60. Course I could just be looking in the wrong place.
I'm still debating what to do. I could replace the inernal, keep the 160, and when I can afford it again buy the SwiftData 200 kit to install it inside. That's a bit more money, though, but will give me more room to expand in the future.
It's a tough decision. I just want to do what's best for my G5 of course and keep it happy!

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