Yes I do that on the servers I admin. On our file server that holds our roaming profiles I setup a share called RProfiles and a separate file and share called TSProfiles. Put the TSPrfiles location in that tab you found in AD.
Then on your terminal servers you should go into GPEdit.msc and then go to User configuration/Administrative Templates/System/User Profiles. You will want to exclude directories in your roaming profiles there. (Don't do it on your domain GPO's or it'll strip down your regular roaming profiles too, just do it on the TS's) I exclude everything but Application Data and Desktop on mine (I redirect "My Documents" through the default domain policy)
If you want to go the extra step after their profiles are created and they have customized their settings you can go in and change the ntuser.DAT to ntuser.MAN to make it a mandatory profile, but if they have to make changes later it's a pain. We have some generic profiles I did that with, but I don't do it for regular user accoutns and our sizes stay fine as long as people don't save crap to their desktops. Some environments you might be able to get away from roaming the Application data too.
Oh and one last thing, if you are wanting to save the space on the terminal server you can also have it "Delete cached copies of roaming profiles" in the gp editor thats under Computer Configuration/Administrative Templates/System/User Profiles. do that on the TS also unless you want it to apply to your entire domain.
Edit: For both of you having issues with regular roaming profiles you might want to exclude a few directories on your domain group policies also. Things like Print hood and My recent docs, or even local settings depending on software.. watch out though, sometimes some software likes "Local Settings" and some users might whine about the recent docs. Just depends on users and environment. I have ours pretty stripped down and use the redirect feature on as much stuff as I can and I hardly have profile issues now.
