I've used software raid 5 on several generations of servers at home over the years.
Performance varies dependent on what hardware you are using and can be quite slow particularly for writing but it's perfectly usable.
Reliability I have had no issues using it. I have had also had two disks fail (at different times on different machines/OS releases etc), one a 40GB and the other a 500GB and in both cases the system handled it without issues ... in fact the hardest part was working out which disk was generating the errors to replace.
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