The space you want completely depends on what you're planning on using it for. No need to buy a drive much larger than what you'll be using since larger ones will always be available for less in the future.
If you store a complete collection of video, you can run out of space pretty fast depending on the size of your library. It wasn't hard for me to fill 200GB of video even before adding demos and other PSN content.
But if you have an external drive large enough to hold a full back up of your current 60GB drive, that's the only way to get a mirror image of your content when you restore it to the new drive.
Takes a while too. I'm swapping a 320GB drive with a 500GB drive next week and a 175GB back up file takes well over 4 hours to complete (and probably another 4 hours to restore to the new drive). So delete whatever you don't want to back up before you do that to save some time.
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