My Mac Mini as a server turned out great.
I purchased the base model Mac Mini. (2.5GHz dual-core Intel Core i5, 4GB)
I replaced the internal hard drive with a 128GB SSD.
(SSD makes this Mac Mini much more usable)
I have several external USB 3 Hard Drives connected to it.
1x - 3TB Drive strictly for Time Machine.
1x - 1TB Drive for iTunes Library (Movies,TV Shows)
1x - 2TB Drive for General Storage. (Photos, Apps, Docs, Projects, etc..)
Ive been running it non-stop for a year without any problems.