Self Hosted Engine ISO storage domain

Hello gents, I am in the process of evaluating RHEV and have run into the problem of creating an ISO storage domain when using the self hosted engine. Also im pretty new when it comes to RHEV and Linux, so I might yet not have the whole picture and might write some silly things.

On a previous setup I used a DL360 as the manager and NFS storage, two DL380`s were RHEV-H hosts, and an MSA SAN was connected with iSCSI and FC for VM storage.

Currently in order to utilise machines effectively, I am using the two DL380`s as RHEV-H hosts on both of which sits the Self Hosted Management Engine with High Availability. The MSA is being used as storage for the Manager VM.
All in all the manager is working good and all, but I have run into the issue of creating the NFS storage for ISO files. If I have only two machines and both of them are used as RHEV-H hosts, where should the NFS storage reside?

Hamfistedly i have tried:
Creating the domain on the RHEV-H hosts, i get errors saying its a read only file system when I try to create a directory for the ISO NFS storage.
Attaching flash storage to the RHEV-H host and storing the nfs files there, but I got stonewalled due to the fact that I cant create any directories on the host onto which mount the USB flash device.
And lastly I simply installed RHEL on another machine. Im back to storing ISOs on an additional machine that`s sitting by idle.

So to repeat again my question- where should the ISO NFS storage reside when the manager is self hosted?

Also, some minor additional questions i dont feel are worthy of an additional disscussion:
How does the other host "know" whether the machine hosting the RHEVM VM is down and whether should it start the manager VM?
Is it possible to reduce the HA Agent polling time (60 secs)?
Does RHEV provide a Fault Tolerant solution for VM`s?

Thank you!