This is the old Macbook Case, but with the Macbook Pro label and a better CPU. Don't get the Macbook, it is a plastic piece of shitty-ness. The unibody MBP is far superior.
Good call on adding more HD space, but only get AppleCare if you can afford it, I don't think it cover's you in case of beer spillage, dropping etc.
This article is pretty useful for figuring out if you need it:
If you got the $$ and can afford it, do it, as you'll be kicking yourself if it breaks and you have to pay loads.
The screen size depends on if your going to be photoshopping, editing videos etc. If you value portability then 13" is a good size, but if your going to be strainging over the laptop long into the night writing assignments, then you may want to consider the 15". The weight and size may be an issue for you, and again the cost will no doubt be a factor.
As said above, you can pick up a decent size monitor for not much these days, add a keyboard and mouse, and you've got yourself a workstation for home, with the added portability of a laptop when at school.