That sounds about right. Have the filesystem and log files on the CF card with your bigger audio/video files on the disk since if those get corrupted you can just repartition (assuming it's still usable) and yank 'em from your home system again. Boot times won't be an issue if you keep it minimalistic. I have a 450mhz PIII that boots as fast as a Sempron 3000+ because it doesn't have much in the way of startup services.
In terms of bins, you'd likely be fine going with a minimal install from Arch or Gentoo or *nix and openbox or xdm or whatever with the output from the OBD going to a script that can calculate whatever you want and toss it in log files for easy reading and display via conky. Graphs and figures regarding whatever you want to
display.
Fourthbean 
cfg83 
Threaded Mode
