Space limitations aside, it IS possible, but not easy. Modded Amiga 1200s that are hacked to take 3.5" HDDs use some sort of size step-up cable I think (though dont quote me on that!). the main issue is the power, as the power for laptop drives is on pins on the end of the IDE connector, whereas normal drives have the four-pin molex type connector.
Basically, where there's a will, there's a way.
BTW - USB would suck power like nobody's business, and you could only boot from it if the BIOS supported it.