We still have the 500gb disk and have plenty of stuff that hasn't been watched yet
I've argued that for a long time. If rate-of-watching < rate-of-recording, it's a losing battle however big the drive is (all a bigger drive achieves is to put off the evil day and multiply the work required to sort it out).
There are only 24 hours in a day, only 7 days in a week, and only a proportion of those are available for telly watching. If you were to record 1 hour per day's worth more than you watch (on average), it would take 16 months to fill a 500GB disk (assuming 1GB/hour)... but conversely, if you have a 500GB backlog and manage to watch an hour more than new recordings (per day, on average), it will take 16 months to clear the backlog.
You only need to record (on average) the same amount as you watch (on average), like a FIFO buffer. Anything over that is just clutter and stuff that's being kept for sentimental reasons. Delete the clutter, and park the sentimental/rainy-day stuff on an external drive.
However, the counter arguments are that big drives are now much cheaper than they used to be, and if you need to replace your drive anyway there's very little cost difference in fitting a big drive rather than like-for-like. Also, if there are multiple users, a big drive provides room for FIFOs for each individual.