First, SQL Server would be my choice also. You don't mention what applications you will be running to access the data, but do take into account 1) the growth of the data, 2) at what intervals you can archive information, 3) peak periods when you need may need additional processing power (ie. end of month processing, end of year processing, etc.)
My suggestion would be to have whomever you select as a hardware vendor scale a system for you.
Load balancing will probably depend upon the applications you are running. Some applications lend themselves better to load balancing than others.
You also might look into a new storage technology call the Storage Area Network. It's a very cool technology that seems to work well once you get it running.
I would guess that you would want multiple servers. Anything else you run on the database server is only going to take CPU time from SQL.
In the case of using multiple server and a Storage Area Network, yes, network speed will drastically affect performance. But remember, the app servers and DB server can be set to talk to each other over a 1Gb network while they talk to everyone else over a 100Mb network.
These are just my thoughts, but I hope they help you out.
