Is it possible to relocate the home folder to a remote network drive? I want to do this so my users have their files on the network drive which is backed up daily. In addition if they log in on another computer they will see the same desktop etc.
I'd say that's risky to do the whole user home directory. If the file server is unavailable, there could be some screwy problems. You need the Library directory and perhaps some of the hidden files within the home directory all the time.
I'd recommend using symlinks to map specific subdirectories of the user's home directory to the network share. You could do Documents, Desktop, Movies, Music, and Pictures without really affecting anything. I actually do this with my own Music folder because I want to keep my iTunes library on my server.
The first argument is to the mounted directory you want to alias, and the second one is the location of the alias. Of course you'll have to delete the ~/Documents folder before you can create the symlink.