Mark,

>My major concern here is data corruption. I plan to battery backup
>all of the peers and am willing to put NT (W2K?) on each if necessary.
>Each client will run its own copy of the app, write its work files
>locally ... The "server" peer will be a new one (PIII-500 or better)
>and will only share the data files. What I'd like to avoid is
>(at least initially) maintaining a dedicated server box for 2 clients.
>I don't ever see this app expanding beyond 3-4 clients (this is
>my wife's business and we don't want it to get any bigger than that).

Analyze the COST over 3 years of a dedicated server (under $2000 for a good brand name with 5-user Server OS) vs. potential data corruption problems.

Using the server as a workstation in a database system is suicidal, no matter the size of the business. I would *strongly* urge you not to go peer-to-peer. Maybe OK just for typical Office programs, but not for database systems.