If reliability is your main concern, then replacing your optical drive with another hard drive is THE way to go...but not the way you think.
Replace your main drive with a 500GB, also replace your optical drive with another 500GB HDD.
Set the two up as a RAID1 array (mirrored array type). This will not increase your speed, but if one drive fails you can carry right along without blinking.
Historically, Hitachi has been really good about reliability*. I like their 7K500 series. You might also consider installing a pair of Seagate Momentus XT's, which are hybrid flash/mechanical drives (they have 4GB flash built in to help out the mechanical platters). Each of them runs about US$100. Check for yourself
what Newegg has to offer. Just make
sure to get a drive which is only 9.5mm in height unless you are
positive that one of the larger 12.5mm drives (usually this would be the higher capacity ones) will fit.
The idea about using an external to offload big files is also a good one. It allows for even larger capacity storage. Just make sure you are not saddling yourself with a single point of failure in the process.
--Patrick
*Western Digital just bought Hitachi's HDD division, no idea what that means for price/reliability going forward.