Can I upgrade the SSD drive in my new mac mini?

Unfortunately not. The T2 chip and security architecture mean that the SSD storage is soldered onto the logic board and cannot be user services or replaced.

Therefore it is important to consider how and for how long you plan to use your Mac mini. Yes you can expand the storage with external drives, but they will not be as fast for read/write as the internal SSD due to the bottleneck of Thunderbolt 3 / Ethernet / USB C / USB 3.0.

I personally went with 1TB of storage as it is definitely enough to hold macOS, a reasonably sized Bootcamp partition, all the apps I currently/plan to use, and my Photo library. Look at all the things you currently use and their sizes, and double/treble it to give yourself room to expand in the years to come.

Target disk mode makes a Mac appear as an external hard disk on another Mac, allowing you to quickly browse and copy files.

I sometimes put a PowerBook/MacBook into target disk mode to transfer large files to/from a desktop Mac.

https://support.apple.com/en-us/HT201462

You can install the system on an external disk (you have to enable external booting via the Recovery mode).

But I'd use the internal disk as a main system disk and move large data files (Photos, iTunes libraries etc) on the external disk and maybe power it on only when needed.

Remember to backup all disks.

You could potentially do that, however the bottleneck created by Thunderbolt 3 / USB C / USB 3.0 will be more prominent because the OS with be constantly moving things into and out of RAM.

Target Disk Mode, which allows you to boot the Mac using an OS on an external drive is designed as a recovery option and not intended for day to day use.

Using a Thunderbolt external, you will experience drive speeds similar to that of your internal drive. I've set up my mini with the internal drive containing my System and applications. All my media files on an external SSD. I have a second SSD which is a clone of the internal drive - this is my emergency drive. I notice no difference in speed between the internal and external. As noted, you'll need to boot into recovery mode to allow booting from the external drive.

No, it' soldered to the CPU.

[post moved: replied to wrong person]