RAID-5 Network Area Storage Solution or Something Similar

I need to create a RAID-5 array for redundant storage on my network, but I'm trying to keep it as affordable and as scalable as possible. I would like to start off with about 500GB or perhaps closer to 1TB. I've deliberated over setting up a linux box to drive it and host it (using reiserfs 4) and then serve things off of a Mac Mini or another box with Server installed. I'm tired of loosing so many drives lately (in my consulting business we've seen 80+ hard drives go bad across the state and locally a bunch of other drives go out on customers ranging from home consumers to SCSI drives; seems like something is up at the moment with all of the mfgs as I've never seen such a failure rate before). Heck, I've lost three of my own lately, one of which was an external backup as well as the original drive that had the data, so that was quite a loss. I am wanting to get this redundancy in place and at a later time actually back off to to perhaps a distributed fs across all of the workstations. I was wanting to set up a gigabit network and hoping that will be fast enough to flow data around my fairly small network (under 15 workstations). My workstation has much higher demands than any of the others as I do video and 3D work as well as general programming, etc. I'd like to even, if possible, keep my applications installed on the external array. Another point is that I'd like to run some daemons that will constantly be checking SMART as well as testing for bad blocks and telling me when hardware failure is imminent so that I can either hotswap or plug a new drive in and let it rebuild. I'm fearful that I might have to go with some sort of hardware RAID device for that, but I just can't find anything really good aside from some offerings from some of the larger manufacturers. Any ideas or solutions that you've seen work? It would be great if I could afford an Xserve with Xraid + Xsan, but that's just not possible.