It's tedious, but not that hard (or "insane" in my view).
It'd be hard for me to argue that it is insane given I have done this as well. I am disciplined and rip as soon as I get new titles. The only time it feels tedious is when I have multiple TV seasons turn up in a single shipment (often the case due to cost reasons). The hard part with TV is not the ripping, it's naming the files and checking the content against episode guides. The rest is straightforward scripting to calculate an MD5, and copy to the appropriate directory structure on the RAID.
Early on in the process, I lost 100 or so movies. I was using a pre-release build of FreeBSD with early ZFS support, and drives that didn't work well in a RAID configuration. Re-ripping them didn't seem like much of a chore at all. I was using DVDDecrypter back in those days... the last version was from 2005. Newer tools are even easier.