Coputer or NAS

Western Digital has one and two drive NAS unit's available. I would of course recommend the two drive unit set up RAID 1 (mirror). The drives are user replaceable, so if one drive in a mirror fails, you can replace it with a standard SATA drive and be on your way. If the motherboard were to fail, I would expect the drives could be moved to another housing to salvage your data.
You can plug an external USB drive into the WD NAS units to expand storage BUT that external USB drive will only work with that NAS and it's volumes (which I think is stupid).

I'm not sure about the Logitech unit you have, but my Sonos can access the NAS while every other computer is off. Sonos has free apps for either computers, tablets or smartphones. Download the App, find the Sonos over your wireless network, and it's intuitive from there. You can have multiple devices (such as smartphones) loaded with the app to control the sonos, so anyone in the family can access the music. And you can have more than one Sonos ("Connect" is I think the model) access the same NAS, meaning you can control and play music from any room in the house without affecting another Sonos on your network.

NAS is a great way to make the data available to anyone or anything on the home network.

I am also interested in any success stories people might share regarding running Logitech Media Server on a NAS type device with multiple Squeeze clients connected.

NAS is network Attached Storage.

It has no participation in the management or configuration of a network but rather is just a dumb box with lots of storage space that is plugged into your network.