Raid 5 speed is so so. It's fast for reads, but not much faster for writes. Even slower in some cases... this is because the system has to write to at least 2 drives to preserve parity plus do the calculations, even with very nice hardware writes tend to be a bit slow. For reads it's like mirror-Raid.
On my system I did a bunch of benchmarks and they were not faster at all over a single harddrive and I was a bit dissapointed But that is only with 3 drives. If I had like 5 I would expect to see some improvements in read performance. I think that for multi-user activity I'd see better performance even with just 3 drives.
And for rebuilding the array.. Yes.
Linux doesn't support hotplug-able SATA yet anyways.. In the future it will though.
You'd have to take the machine down (if the drive didn't take it down) and replace the drive, then boot up and then add the new drive. Then it should rebuild fairly automaticly. Keep in mind though it can take a long time...
For instance when I initialy installed my array it took 3-4 hours to have it get built up all the way. When rebuilding it should be accessable.. I think.. but it's going to be very slow with all the disk activity and such.
Also you can setup a 'hot spare' drive so that it will take over automaticly when you rebuild.
Also keep in mind this is just me fooling around with stuff. From what I know it all makes sense, but I am not a expert. For your reference you can find the Software RAID howto at:
http://www.tldp.org/HOWTO/Software-RAID-HOWTO.html
and a bit about recovery:
http://www.tldp.org/HOWTO/Software-RAID-HOWTO-8.html
However using Linux Software RAID in production is fairly common and it is mature. Most modern installers allow you to configure software RAID from the install menu, too (and LVM). At least for Debian Testing you can do this.
If you want more perfect uptime, so that you know for certain that unless you loose power you'll have aviability, the next step up would be high-quality hardware raid device OR high aviability-style clusters. Basicly 2 servers sharing the same IP address and are mirrors of each other and communicate thru a special network filing system. So that basicly you'd have harddrive RAID 5 on each computer and then the computers be RAID 1-style mirrors of each other. So that if you need to take one down you have the other one to carry the load. (just a FYI)