<p>My project is currently using a svn repository which gains several hundred new revisions per day.
The repository resides on a Win2k3-server and is served through Apache/mod_dav_svn.  </p>

<p>I now fear that over time the performance will degrade due to too many revisions.<br>
Is this fear reasonable?<br>
We are already planning to upgrade to 1.5, so having thousands of files in one directory will not be a problem in the long term.</p>

<blockquote>
  <p>Subversion on stores the delta (differences), between 2 revisions, so this helps saving a LOT of space, specially if you only commit code (text) and no binaries (images and docs).</p>
</blockquote>

<p>Does that mean that in order to check out the revision 10 of the file foo.baz, svn will take revision 1 and then apply the deltas 2-10?</p>

Subversion only stores the delta (differences), between 2 revisions, so this helps saving a LOT of space, specially if you only commit code (text) and no binaries (images and docs).
Additionally I´ve seen a lot of very big projects using svn and never complained about performance.
Maybe you are worried about checkout times? then I guess this would really be a networking problem.
Oh, and I´ve worked on CVS repositories with 2Gb+ of stuff (code, imgs, docs) and never had an performance problem. Since svn is a great improvement on cvs I don´t think you should worry about.
Hope it helps easy your mind a little ;)