iMac Backup and AirportExpress/Networking plus External HD Backup

All,

I am looking for a good solution for digital media storage as well as backup for my iMac.

I recently purchased an AirPort Express and was sad to find that I can’t use it to share my external HD through the USB port as was posted on another mac help site...
This matches up with my many tries to get my Western Digital HD to show up anywhere in the AirPort Utility.

So, I will post my current equipment and would be happy to have any feedback on how to set things up appropriately.

Thanks in advance!

Solution Requirements
Nightly TimeMachine backups of my iMac
Easy backups of my digital media drive (Digital home movies, pictures and MP3s)
No use of my iMac USB ports…I only have 3 on the back of my iMac - 1 for my keyboard/mouse, 1 for my printer, 1 left for iPhone/iPad/iPods/Digital camera/Digital Video Camera etc
Ideally I would like one External harddrive for home movies, pictures, and MP3s and then one HD for nightly backups of my iMac and backups of the other HD.

Current Equipment
iMac 2.4 GHs Intel Core 2 Duo Mac OS X v 10.6.6 (320GB Capacity, 37GB Available)
Western Digital External Harddrive (1TB) with only a USB connection
Unknown External Harddrive…I am still shopping for a second HD, will take any suggestions!
Vizio Dual Band HD Wireless Internet Router currently running my wireless network (I don’t know if there is a max capacity for these types of things but I connect a wide variety of things to the network including: iMac, Airport Express, Xbox 360, PS3, Wii, iPad, Toshiba Laptop, Vizio TV – not all are connected all the time obviously
Airport Express 802.11n Wi-Fi

No thoughts?

Perhaps the simplest solution is to buy a USB hub for your iMac to expand the number of USB ports by 4-8. Then plug your ext hard drives into the iMac and forget about network storage (it doesn't sound like you're trying to access common files or folders from multiple computers on the network).