Network Rework help

Hi all, first timer here. I recently became interested in consolidating my movie collection by ripping all my dvds (several hundred) into something accessible over my home network. I also have a sizeable photo and music library (Aperture & iTunes) and would like a way to keep everything backed up. This of course opened a huge door and I'm now a bit overwhelmed. I'm not inherently tech-savvy but am not afraid to research and learn new things. Here's where I'm at:

Problem - I am very close to my current data capacity
Problem - My a/v library is spread out across too many mediums (DVD, Blu-Ray, iTunes, UltraViolet, .avi files) and different drives.

Goal - I would like to consolidate all my data (movies/music/photos/etc) into one network and/or drive, accessible by all my devices
Goal - I want at least one redundant layer of data backup.

Question - I don't know what kind of hardware I should buy/use to meet my goals. I RAID the best answer? Which type?
Question - what kind of file formats should I rip the movies into? Is there a practical difference between .mp4/.m4v files and .avi video files?

My present network consists of a Macbook Pro, iPad & iPhones, 2 ATVs and an old Apple Extreme Base Station plus a Roku and PS3.

-A buddy recommended his setup which consists of a 3TB WD external plugged into the Extreme Base Station (via ethernet) and accessed by a jailbroken 2nd gen ATV. He seems pleased with it, but I don't see that there's any data backup, and it appears he's watching movies outside of iTunes which makes me wonder whether he can access them outside of his network (traveling).

Sorry for the long post, I appreciate any help offered.

A NAS with RAID will probably answer your needs pretty well. The beauty of a NAS as opposed to a just a single HD attached to an Extreme Base Station in addition to the backup facility is that the NAS' come built-in with a bunch of functionality to stream media to a variety of devices..

I have a Netgear ReadyNAS, for example, and I put all of my music and movies on there. It is a DLNA (look that up) complaint server and my Samsung TV and XBOX are also DLNA compliant and can stream videos/music directly from there..

The NAS also has a iTunes music server built in so any device (speaker or not) that can stream from a computer running iTunes can not stream from your NAS directly.

You could also open up the necessary ports on your router to be able to access the NAS from the Internet while outside of your home network..

Synology NAS' are getting a lot of fanfare and praise lately and I would look closer at those. While the ReadyNAS I have works, it's a very old one based on an outdated SPARC processor that's limited in processing power..

In my case, I'm pretty much the only one using it at any given time, so it's no biggie. But if you have multiple devices simultaneously accessing it, it might start to bog down...

Many thanks for the help. I've started looking into the Synology bays. Do you have any opinion between iTunes compatible video formats (mp4/m4v) versus .AVI files? It seems a lot of video files out there are .avi's, I'm curious why the preference? I'll have to jailbreak my ATV (unless there's another option) to be able to watch if I go that route, or is there a way to get iTunes to import them?

Thanks again!

I keep most of video files on my NAS in AVI format. I only convert them to MP4 if I intend to sync them to my iPad or something. iTunes has no problem importing AVI files and streaming them.