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I have a Vortexbox appliance, a pretty cheap and cheerful server with an internal HD, 1 TB. Well, it died. The manufacturer (Small Green Computer) basically sold me a new one with a big discount (my original unit was out of warranty). Fortunately, I had a backup USB drive, and simply restored all my files (which had taken me a few years to rip to the server) onto the new unit's drive. Moral of the story - always backup everything. I have a backup at home and one in my office, just in case I get burglarized or there is a fire. You don't need a fancy drive for backup. Any cheap USB drive will work.
I used to have the Melco N1A and now use the Melco N1ZH. Either unit will sound noticeably superior to an unoptimised computer. Both Melcos are sonically far ahead of my Synology 214 NAS used as a DLNA server by the way.
Although you won't get this confirmation from Melco, one of the owners in Singapore has had luck with swapping out the hard drives in his N1A for SSD drives. It goes without saying too that you should be regularly backing up your music library too.