I make a lagarith avi of every single episode in a series (unless it's a useless repeat like in NANA) and put it in their designated anime folder on my external drive. Then I import all of the episodes into Vegas, put them on the far right side of my timeline, mute their audio track or delete it, spread them out a bit so I can see where one episode starts and another ends, put the song I'm using on the far left side of the timeline, and from there I just edit the normal way, taking away clips from the episodes and putting them on the song.
I hate searching for clips I want to use before I make an amv and then encode those little bits because it's time consuming, boring, I'm way too lazy, and more often than not I find a better clip to be used.
I'm typically very familiar with the sources I'm editing, but even if I don't know what I'm doing, it's a hell
of a lot faster to be looking at the episode in Vegas rather than skimming in Vdub and picking and choosing small scenes. Also, it's less boring, and I always find new and better scenes.
And for me, a 1TB external drive covers everything. I'm not one of those crazy people with hundreds of anime anyhow. I have specific tastes, so I have about 20 anime. I don't like editing 50 episode anime though, like FMA, because the way I edit (putting all the episodes into a timeline) makes that more tedious, unless I'm really
familiar with the source. But for me, I have movies, ovas, then 11-26 episode series. NANA is the only long series I have, and even if an anime is divided into two seasons, like Honey and Clover, it's fine.
Sometimes if I know I'm making an amv focused on two characters or whatever, I can eliminate some episodes, but I'll typically still put them all in, then just delete large chunks of episodes where the character doesn't appear to reduce clutter. I don't like not importing the episode at all though, even if they're only in it a bit, because I may miss even just a facial expression or a minor scene that's perfect. So even if it's a long anime like NANA, I still put in all the episodes.
And for me, I don't have any issues navigating through them or becoming overwhelmed by all of the footage and excess scenes.
Oh, and I have no issues with vegas becoming slow because of this. When I edit, Vegas is the only thing that's open anyhow. It'll typically be a bit laggy to start with, but the longer I edit, the smoother it gets.
So even though it seems that the program would become slow and all that clicking around to get the scene I want would slow me down and making editing longer... I make all of my videos in under 4 hours typically, and those are full length, minimum 3 minute amvs.