I also thought about using DFS, the file type should be fine since is just a file server. However I have Windows 2003 Server Ent. and DFS wasn't really the best for the particular release (it was really improved in the R2 release with DFSR).
But the real problem is that this is the file server that holds home drivers, and the different business shares, etc... so we would like to P2V and keep the same name, SID, etc...otherwise the scripts and AD needs to be reconfigured.
To my knowledge if I use DFS I need to introduce a new server and then set up the DFS links and replicas. In order to acomplish that I need a new server joined to the domain so different hostname, IP, SID etc...