There are a number of alternatives available which will work happily with your machine.
You should be looking for an external drive with a Firewire (IEE1394) connection, rather than a USB one. Firewire behaves well with the Mac and a Firewire drive is also capable of booting the Mac.
La Cie make a reasonable external but it is also possible to "make your own"
Using a Firewire enclosure and an "off the shelf" ATA hard drive, you can be up and running with a large capacity external for a lot less than an already built one. www.macsales.com have a selection of enclosures and your local BestBuy/Circuit City have regular sales offers for large drives. Those two places also sell external drives but most of them are USB devices.

P