Ultimately I do not believe that JPEGS are the answer as they
deteriate over time with repeated viewing... That is one reason we
now have RAW the raw data remains over time.
Err... that's not quite accurate. Data is data, and doesn't deteriorate over time when simply viewed (copied from HD into RAM), unless something is seriously wrong with your hard drive or storage media.
What
does deteriorate with JPEG is the image quality when you edit the file (in Photoshop, for example), and then save it again as a JPEG. Sequential saves in lossy formats is a no-no. You can get away with a little of it, but the quality loss builds up pretty quickly. So never archive images in a lossy format like JPEG, unless you're sure they'll never need further downstream editing. It's an editing issue, not a viewing issue.
The idea of RAW data remaining over time is also a touchy subkect. It will remain, as long as there is a reader for the proprietary RAW format, and that's far from guaranteed. With the rapid release of totally new and incompatible digital camera bodies every couple of years, are you willing to bet that your current 5D or 1DsII Raw files can be opened in any software made by Canon or Adobe, 10 or 20 years from now... after they've gone through 5 or 10 more camera versions? It's a big, risky bet. So I do shoot in Raw, but I also save out the most important, portfolio-grade images as an uncompressed TIFF file, for future compatibility. Which is a different type of gamble, but I think a safer one.
On the hardware storage question... I'm using a fairly low-end NAS drive (network attached storage - Buffalo Linkstation), which is basically a small box with a hard drive and its own tiny operating system, hung on the local network. It's only very slightly more expensive than a USB external hard drive, and has some advantages in standalone recovery. There is a duplicate NAS drive hooked up to the primary one, that constantly backs up the primary. I don't use compressed backup formats. It's all readable as standard files from any computer on the network.
Right now I trust "roll it forward" on multiple hard drives, much more than I trust the idea of writeable CD's or DVD's as a long-term archive media.