Gareth, I wold get the 04 S. Someone has already taken the first years depreciation hit for you and you get Ohlins - thats worth it.
As for luggage dilemma's I haven't had that issue as I haven't toured on my 996 but I have both a single and dual seat. I tend to wear a backpack when commuting anyway.
That hiring sounds dodgy to me, I would be a tad p!ssed if I had to do the same thing. Ducati's are lumbered with the reliability issues of old which is a bit of a stigma thing these days. I wouldn't worry about it unduly. they fare no worse than a Jap bike with some bikes having problems and the majority not to be honest. Just get it to a good dealer/independant and get it sorted out properly and then you'll have nothing to fear.
Good luck with your purchase and welcome to the club. There are regular Surrey rideouts and we do track days etc if your into that sort of thing, even have our own race series for those members that are slightly touched (ahem).
