Three Monkeys, Three Typewriters, Two Days

Western Digital makes lot of those disks and they are probably the once currently topping the sales charts. You will also find similar USB2 disks from hardware manufacturers like HP.

About the ethernet connectivity, I vaguely remember such 'interfaces' existing and google pointed me to http://www.amazon.com/Linksys-Storage-Link-Drives-NSLU2/dp/B0001FSCZO, if that is the kind you are looking for.

Personally I would prefer either donating the old desktop or re-using as many parts as possible from it - in your case the harddisk by buying a USB2 casing (the only issue would be that a USB2 casing would not be as portable as the Western Digital or HP external drives)

Apple Time Capsule?

Prasad, the disk in the old desktop is a few years old now, so I don't want to keep using it for data storage for much longer. But yes, for a year or so that solution would work. Thanks for the pointer to the linksys drives!

Bernie, I did consider that. But I would somewhat like my storage to be separate from my wireless router so I can upgrade or replace them independently as needed. I would also like to be able to access the storage directly as needed, without the wireless router.

There are many different external USB2 drives available. In most cases they are using a Laptop 2.5" HDD and that works great.

The only problem is that some drives need more than the 500mA per USB port, especially if the HDD powers up. Some drives comes with a Y-USB Cable to get Power from 2 USB Ports or the drives comes with an external Power Supply.

Most USB Ports on a Desktop-PC have more than 500mA but many Laptops,Routers and USb Hubs disable the drive if it wants more than 500mA or they just have a hard limit at 500mA which results that the drive can not start up.

You should find a drive that only needs 500mA and not more. There is nothing else you can do wrong with such a drive.

BTW: Do you have a router with an open Firmware like Openwrt ?

I don't have a problem with an external power supply for the drive. I rather expect to have one, in fact. I do wonder what the tradeoff between the 2.5" and the 3.5" drives is, if someone happens to know.

The router in question will almost certainly be an Airport Extreme.

Well, I just feel I need to say one thing about that : NEVER buy an external drive whose power connector is physically the same as the one of your laptop.

The second thing I'll do is never again buy a Maxtor product when they don't value my data enough to incorporate inside their external drive the small diode component worth pennies that would have protected it at that moment.

The best-of-the-best these days is the Drobo, but it's rather expensive (though for adding storage, and replacing drives, it's amazing).

Personally, I have an old Mac with 2x250GB (I think they are 250's) Seagates. Using rsync and a cron to mirror every 24hrs since I don't trust RAID in case of corruption I don't want to loose data on 2 drives. Samba, FTP, SSH, what more can a geek ask for.

As for just doing a USB drive and a router... I think the drive itself is the easy part. USB enclosures all pretty much use the same 2 or 3 chipsets, so it's really about the case unless you have a reason to prefer a certain chipset. My personal recommendation would be to look for the following:
- Aluminum enclosure
- Power switch on the actual drive
- Large fan (less rotation means less noise and longer life with decent airflow).
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I got a cheap Firewire + USB2 for < $30 a few years ago... they really aren't that expensive. NewEgg to the rescue.

The router is the more difficult part. I have a feeling your looking at an Airport Extreme. Just make sure you check out the access restrictions you can setup... would suck to store data on there and anyone who hacks your WiFi has access to your unprotected data.

The Apple Airport Extreme Base Station has a USB connector that will allow you to insert any USB hard drive and use it as a shared device. I'd get one of those (available refurbished for $99) before I'd get the dedicated Linksys interface for $50...

Beyond that, I'm in the same decision making process and was hoping to find more/better advice from your commenters. In general I go by top sellers/recommendations on newegg.com

greggles, where'd you find an Airport Extreme refurbished for $99 (the 802.11n version with gigabit ethernet)? I'd love to get that!

I realize that this is a bit less space than you requested, but you can get a 32 GB USB flash drive for around $90 now. They are at least as fast as other USB devices and much more portable than traditional external hard drives. If you are willing to pay a bit extra, this is the way to go.

I'm not convinced on the reliability of the USB flash option, to be honest. Or the performance, from what I've seen. And yeah, 32GB might be a little low; we do plan to store some video on this drive.