Optimizing MySql and Perl - looking for feedback for flow of system

[Richard Jones]

I am developing a system for a website we are launching on Sept. 1, 2007.
We have just Pre-Launched(1 1/2 weeks ago) and have already received just under 1k users.
We expect to have well over 100k by the end of this year and over 300k by mid 08.

We don't trust email delivery because of the different ISP's and spam filters and so forth. We want every member to be able to receive messages from the people that referred them to their personal website(every one gets their own personal replicated website). Here is how I will develop it:

Member 1 logs in and clicks on messaging system.
She then chooses to create a message and sees everyone that signed up on her website listed as options to send the message to. No extra people can be added only those that signed up on *her* personal page.
she can then send the message she creates and it will show in their back office that they have a message. They can then take the following actions:
delete, archive and forward.
Forward will only allow them to choose those who signed up on *Their* personal replicated site. Those members then have the same options. and so forth.

What I'm worried about is how large the database will get when we do have 100k registered members, not to mention 300k users +
If the first person who signed up sends one message per week, and it does managed to filter itself all the way down the pike, that could be over 100k messages in the database, per week. If all those get archived, and we do this for just say 4 weeks that would be 400k records!
That seems to me like it would have some major degredation issues trying to read/update and insert into a table that large.

Can you tell me if MySQL can handle millions of records efficiently? Or do you know of a better way to do this?
I am open to suggestions, big time.

Thank you much, and if you need further details, please let me know.

Richard