Inspiron 1720 - 5400rpm, 7200rpm or SSD?

7200 rpm is probably the best compromise between the capacity you need and performance.  You might also consider the Seagate Momentus hybrid drive - it has both a 7200 rpm mechanism and a partial SSD design.

http://www.anandtech.com/show/3734/seagates-momentus-xt-review-finally-a-good-hybrid-hdd

From a 5400 rpm, sure - faster.  From a hybrid or SSD, slower.

What about just a plain 7200rpm 2.5" SATAII hard drive without the hybrid? Any noticeable difference?

It needs to be said that I don't mind small capacities as I'll be running it with an external 1TB Hard drive, where all my documents, virtual machine files are going to be.  I'm happy with at least 30Gb as long as Windows 7 and my programs can fit in the drive.

30G will be a very tight fit for WIndows 7 and any moderate load of applications.

Practically speaking, consider an SSD no smaller than 128G - preferably 256 - for Windows 7, particularly if you're going to be loading large applications on the drive.

Also note that the lower-cost, lower-capacity SSDs are not as reliable as the higher-end ones -- and that in general, SSDs aren't as reliable as conventional hard drives (not yet, anyway) -- so backups are essential.

Contrary to what might be expected, though SSDs have no moving parts, they can and do fail - without the warning you often get with a conventional drive. 

Yes, the difference will be noticeable.

So a 5400rpm to 7200 without hybrid: I'll see a noticable difference?