Server or external?
i personally went with a file server (storage computer) for that purpose, having a single location accessible by all computers on the network is great. but whether it'll be useful to you is another matter. I try to keep the file server on as much as I can as I typically access it frequently and keep an in-home vent channel open, but I seem to be the only one.
If you'll solely use it as backup device, external's not a bad idea. since you won't need to have it on or hooked up all the time. it's also easier on space, but that's debatable.
Server components comments
and if it's just a file server you don't need anything powerful
at all, i've frequently seen "slow", low-wattage ITX cpu/board combos get used. if you'll be adding features to it (i.e. webhosting, ftp, hosting a dedicated game server for LANs) you'll probably want something faster, but i don't know what those requirements are.
mine runs xubuntu and shares using the standard Samba protocol which i've found very useful in preventing my family members from saving things in or deleting things from folders they shouldn't.
Here's basic, small footprint setups:
ITX single core low-end, DDR1, no onboard RAID, 10/100 LAN - it'll work
Jetway board w/ Via C3
Masscool 4-port PCI-to-SATA card
+ RAM
+ OS
+ ITX case (small footprint)
+ hard drive(s) of choice
ITX single core step-up, DDR2, onboard RAID, gigabit LAN - pretty close to what I use, sucks these ITX ones weren't out when I built mine
Asus ITX-220
Masscool 4-port PCI-to-SATA card (optional, 2 ports on board)
+ RAM
+ OS
+ ITX case (small footprint)
+ hard drive(s) of choice
Note: neither of these setups will fare well with, say, an intensive RAID 5 setup. but a simple RAID 1 for redundancy's sake is fine.
of course you can bump up to dual core Atoms or an Matx setup (either chip maker works, they've both got good low-wattage options). but to be honest, I haven't been following the trends with those two so I can't toss up a build for one off the top of my head
