You have to remember that even if sony made it possible to store demos and stuff on ecternal drives the load time would be lengthened. USB 2.0 can't transfer as fast as internal drives. USB 3.0 is rumored to be fast enough to keep up with internal drives but the ps3 doesn't have that technology. If you do use external drives to store media I would use it for pictures, music, and videos to save space on the internal drive for demos and game data.
But yeah you can use an internal 3.5" sata drive on a ps3 but you have to have a extension cable for the sata connection and the power connection. It would allow more dust to enter your system unless you make your own enclosure for the drive and cut a small hole out of the drive bay cover.