Any performance benefits/hits to storing the images in on the same FS as the FOG server?
Nope, other than everything being self contained. That’s how probably 95% of fog sites are. Large sites use multi-node setups.
Is there a best practices document for FOG that I can refer to.
Not really. There are some partitioning considerations that you need to think about, that’s probably the most important thing to get right from the start. Once you get into the groove of FOG, you will start doing things your way. We have some tutorials in the WiKi that are written for the absolute Linux newbie. If you’re a newbie I would recommend following one of the tutorials, and going with CentOS 7 only because it’s tutorial is up to date and I haven’t made tutorials for other distros yet… But if you wanted to go with another distro, we can help you along here in the forums.