I have an old late 2006 black MacBook. It has 2GB memory, and a 2GHz core 2 duo processor. I'm interested in using it on our home wifi network as a location for time machine backups (onto hard drives attached via USB) and a shared iTunes library (which an apple TV can access). The OS is currently Snow Leopard.
Should I install a server version of OS X (I think I need this if it's to be recognised as a time machine destination)? For a Mac running Mountain Lion, this only costs £13.99 from the App Store (in the UK). The MacBook cannot be upgraded beyond Lion. What are my options?