I am wondering if this would be ok for small home server?

Intel SR1325TP1 Entry Server Platform

The SR1425BK1 consists of the Intel SE7221KBK1-E motherboard and Intel SR1475 1U chassis.

The Intel SR1425BK1 features the Intel Pentium 4 3.4 GHz Processor, 1 GB DDR2 RAM and 2 x 200GB IDE hard drives! Integrated video and Intel PRO/1000 Server Network connection delivers the speed and reliability for your graphics and network connectivity!

One PCI Express x8 slot, two PCI-X 64-bit/100 MHz slots, one PCI 32-bit/33 MHz slot are integrated for adding a wide assortment of peripherals! This Intel SR1425BK1 is pre-installed with a powerful 350-watt power supply with dual fans to keep the system running at maximum performance! 

All you need is to add the Server Operating System, monitor and the rest and you're ready for fast computing!

Features/Specifications:

• Intel SR1425BK1 Pentium 4 3.2 GHz Server


• General Features:


• No Server Operating System


• Intel Pentium 4 3.4 GHz Processor 


• 1 GB DDR2 RAM 


• 2 x 200GB IDE hard drives


• Integrated video w/8 MB memory


• Intel PRO/1000 Server Network connection


• Motherboard Features:


• Intel SE7221BK1-E Server Motherboard


• Intel E7221 chipset 


• Supports one Intel Pentium 4 processor (installed)


• One (1) PCI Express x8 slot


• Two (2) PCI-X 64-bit/100 MHz slots


• One (1) PCI 32-bit/33 MHz slot


• Four (4) DDR2 DIMM sockets (supports 4 GB of ECC DDR2 400/533 memory)


• I/O Ports:


• Two (2) PS/2 ports


• One (1) 9-pin serial port


• One (1) 15-pin VGA port


• Three (3) USB 2.0 ports (two on back and one at front)


• One (1) RJ-45 Ethernet jack


• SR1475 Case Features:


• Intel 1U Server Chassis


• Three (3) 3.5-inch drive bays


• 350-watt power supply with dual fans installed

 The use it will be getting at home is pretty basic stuff, mainly storage for the units at home (3 x laptops and 1 x desktop)

If it is ok, I am unsure what OS to drop onto it. 3 of the 4 systems at home are running Win7 (one is 64bit) and the other system is running XP Pro.

Do I put XP Pro on the server or win7 or do I need proper server software?

Im not very techie with programming so Im uncertain about using Linux or something. I suppose with a "idiots guide to..." I could work it out, but would rather have a plug and forget solution.

Also, what would you suggest a system like this would be worth?