You can run the slimserver software for the squeezbox on very minimal hardware.
I have it installed on the file server for my home-LAN. This is a 6-year old box with a PentiumPro 200MHz processor and 128Mb memory running Mandrake Linux. The only time the processor is utilized over 5% is when I rebuild the music database.
So if you need a music server and can run it on Linux almost any old pc will do.

My CDs are ripped to .WAV format with "Audiograbber" which is similar to EAC.
For a bit over 450 CDs this comes to about 280 Gb disk space in my case.

If you want to be safe I would suggest setting your disks up in a mirror pair or in a raid-5 array. This will be more expensive to do but will save you a lot of time in case one of the disks fails...

An alternative may be to run slimserver directly on a NAS box. This is basically a hard-disk-box that plugs into your home network as an instant fileserver.
Some of them have the ability to run (for instance) slimserver.
For more information see:
http://forums.slimdevices.com/showthread.php?t=14976
or
http://forums.slimdevices.com/showthread.php?t=16891

Regards,
Mark