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According to the blurb, PS prefers its scratch disk to be on a separate partition, better still, a separate drive. I have mine on a separate partition and have just carried out some tests prior to buying a second HD to use as a scratch disk.
The tests were just to see how much faster my partition is at processing than my primary C: drive. My D: drive is my partition and is used for nothing else but the scratch disk. The test was to upsample an image that would need to use scratch disk. The results are as follows
D: = 65 seconds
C:? = 50 seconds
As can be seen, when D: (the partition) is set as my scratch disk it is actually slower than my C: drive set as scratch disk. Why would this be the case, I would have at least expected no difference... but slower? This contradicts Photoshops recommendations and makes me wonder if it's worth adding another drive as a scratch disk?
On a separate partition, it is useless, as the actuator of the disk has to move between two areas of the disk. Maybe if you set two partitions rather than one, the areas are further apart, thus slowing down photoshop? Having a separate disk should help.
One point I forgot to mention. I had a look in the Photoshop manual last night. Not a single listing in the Index relating to Scratch disks. I could find nothing about it in the whole manual. Considering what you pay for the boxed version, you would think they would make some effort with the manual. There's certainly plenty of room for a thicker copy in the box.
A 7200 drive will make quite a difference. For any performance increase a second disk for the scratch is needed. Although a second partition on the same drive is slower or provides no performance advantage, it does keep the main boot drive from being subjected to fragmentation caused by constant writing and deleting of temporary files...a very good thing.