Re. Cloud backup, CrashPlan offers unlimited cloud storage for around $60 a year ***HOWEVER*** cloud storage is only practical at the lower end of the data size spectrum IMHO.
I use CrashPlan for off site back up of absolutely irreplaceable data and am currently using around 110GB. Having tested the restore speed though that alone would take almost 4 days to download and initial upload is even longer; It certainly won't max my 100Mb connection like say Steam will, seems to restore at around 2.5Mbps (can't complain for the cost). Once my data gets much bigger I'll probably have to start cycling physical copies off site.
If your library ends up around this size (say <200GB) it could be just about practical to use the cloud but remember upload and restore is days to weeks or more not hours like a local copy. CrashPlan also allows automated local backup too for free to allow quick restore though. The main reason I have CrashPlan is purely for the 'what if my house burns down' type scenario and if that is the case your DVDs are probably the least of your worries as they are replaceable.
It's hard to recommend a solution as we don't know the size of the data you will end up with but a local backup is probably best for your needs and given the data is unlikely to change you could easily keep an offsite copy maintained without too much bother if that was a concern.
Any rough idea of the data size were talking about from what you've done so far? Do you wan't off site backup, redundancy to allow high uptime etc?