A:
The 1TB drive is twice the capacity of the 500GB drive (more or less;the manufacturers fudge the math). Depending on the sales at any given time, it may be cheaper to buy a computer with lower hard drive space and RAM and upgrade those yourself, sell off the components it came with and have what you want for less than from the manufacturer. But if you're not comfortable with that, then just pay upfront. I believe the next unit up also has a faster CPU so that is definitely worth it.
The DVD drive is in the front behind a swing out door and is installed vertically. The door is spring loaded and opens/closes with the tray.