Ars Technica has the details on Windows Home Server. Might be an interesting project to see something like this implemented in Linux. A lot of the major bits are there already, shadow copy looks equivalent to LVM snapshots and a bit of scripting + EVMS would give you the "plug in a drive and auto-expand storage" part. Of course, it'd take a bit of work to put it together in the package that MS has, course, they also have a bit more money to throw at this. Also sounds like they might have felt threatened by the availability of the easy home server setup that Linux offers as a file server. We'll see what happens though.

The ars discussion has some good talk on what it actually is and does, as well as (perceived) up and downsides.