That should work. By external HD do you mean like a USB-connected drive? That should be fine for playing music, don't know if that will slow down the "scanning" required for SBS to build up its database. I ran SBS on my desktop PC for a while, and it worked fine. Moving to a dedicated server allowed me to keep SBS up 24/7, not be impacted if my desktop crashes, not having to manually turn it on when I want to listen to music, etc.
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