Just today I dealt with this. I have an M1 Air with a 2tb internal and a 1tb external ssd on a USB 3.2 bus. I just spent the last week editing 61mb files. They were a non starter on the external using any AI processing. On the internal they were far from quick.
I decided to move to a mini or Studio (will wait for an M4) with either a .5tb or 1tb internal and a 4tb Thunderbolt 5 (OWC on pre-order) external. My thinking: with Thunderbolt 5, external I/O will approach internal speeds. I avoid the Apple tax for drive space. I travel a lot. The iPP is my editing machine. With all my images files on an external it’s a snap to bring them with me.
Be aware that sizing a small internal is a bit tougher. iOS backups and Snapshots take up 380gb on my internal. Pretty much wipes out a .5tb internal. I backup an iPP to the Mac and those backups are on the internal. I'll symlink the MobileSync folder to the external. Then there’s the Snapshots and highly desired free space. While the Snapshots are considered free space, I like at least a third of my internal free at any given time. Frankly I don’t need backups of backups but I'm not sure, if deleted, how long they take to recreate themselves and if there’s an impact during usage. I tossed them all this morning so will see. In-any-event, I may go with a 1tb internal just so I don’t need to stay on top of anything.
I think you’re heading in the right direction. Just make sure you do some space planning first. We tend to look at our files. But Apple can grab a big chunk of a small internal's space of which some, can’t be moved to an external.