ddelorme
In case you haven't done it yet: 3 proposals ...
* (A)Try to get a good "mondo rescue" backup of your setup.
A working mondo bare metal backup can expand to "full hd size" latest I looked (haven't done it on a raid though but raid1 should present no problems).
(watch for mondo flaw on sme installed over previous linux version...)
* (B) the raid-way:
Note: RAID1 basically behaves (almost) flawless with just one disk

so we may take away one disk and "mangle it" ... with little risk.
assumptions:
/dev/hda 1st hd raid1
/dev/hdb free
/dev/hdc cdrom
/dev/hdd 2nd hd raid1
we mangle /dev/hdb (or use what is free

and apply accordingly...)
!!! note partition data of your harddisks !!!
-re-cable 2nd raid disk to "free" /dev/hdb
-reboot goto single user mode "telinit s"
-fdisk /dev/hdd3 ...the "/" partition ... most likely "3" (SME standard=check!) ...to your max (=40Gb)
-mkfs.ext3 that newly partition "3" (?)
-copy all data from raid1 /dev/hda3 "/" to new partion "/"
-re-move old working raid1 /dev/hda
& cable new 40Gb raid1 in it's position
(...like /dev/hda removed ...new 40Gb hd re-cabled as /dev/hda)
... and check working system !!!
if it works !!! (albeit complaining about failed raid1 drive) -> clean
-fdisk /dev/hdd3 ...the "/" partition ... most likely "3" (SME standard=check!) ...to your max (=40Gb)
-mkfs.ext3 that newly partition "3" (?)
-re-cable as previous raid1 disk 2 ...
- voila...resyncing for full 40Gb
* (C) 3rd: If you are not familiar with what I'm saying just
- "backup to workstation",
- install a completely new SME 6.0x on your disks
- and restore your backup directory by directory except "/boot"
... there even is a chance that this is faster !!!
regards
reinhold