Small Company – Need some advice

I have a small company that is currently on a workgroup. We have approx 6 computers and now have the need for some sort of central storage and file access. I was looking at getting an IBM server to run file and print sharing. Then I could setup RAID 5. So I guess the questions are:

Would MS Small Business Server work well when running in a workgroup?

Is it difficult to set permissions on a workgroup server?

What are the benefits if any of switching to a domain?

Any suggestions would be appreciated!