A lot of people are running a USB hard disk in there units these days and playing ISO's of games through them. Works really well but i wonder for how long . Theirs a separate thread on this already with a heap of info have a look if your interested and if you have anymore questions ask away.
I personally use and prefer D2sun 1.3A modchips and install these by default unless asked for something else. Its a very reliable chip and i haven't had any issues with it once it was installed and confirmed working. Saying that Wiikey2 is also a very nice chip and has some additional features over the D2sun. But i dont see myself nor the average joe using these features...
If you setup the software correctly by installing a few apps at the time of modding you can ensure the console remains brick free. Like stopping On Disc updates from installing and a few other measures.
To backup/dump your original games you need a special LG drive, check the bst section for those.
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