^For above, the scratch disk holds temporary files, just like ram. Could be large or small, whatever exceeds your RAM.
To the OP, forget the 2nd SSD for a scratch disk. If you have a modern processor (i.e. Quad Core i5 to i7), upgrading your RAM would be more cost efficient and beneficial. RAM is cheap cheap cheap these days and you'd do well with 16GB, allocating half of that to Photoshop. You can set it in preferences.
From Adobe's CS5 help page:
Quote: When your system does not have enough RAM to perform an operation, Photoshop uses a proprietary virtual memory technology, also called scratch disks. A scratch disk is any drive or drive partition with free memory. By default, Photoshop uses the hard drive on which the operating system is installed as the primary scratch disk.
When you consider an average RAW file is anywhere between 12-24mb, having 8GB out of 16GB dedicated to Adobe should be ample, even if you had multiple files open with a bunch of layers added. If Photoshop actually needed more virtual memory, then your SSD (Primary Partition) would kick in as the scratch. SSD's are still big money right now versus getting more sticks of RAM. So I would change your setup the following way:
1. 120GB SSD (OS, primary partition, programs)
2. 16GB ram DDR3 PC1333 or 1600 (allocating 8GB within Photoshop Preferences)
3. Two 1 TB HDD SATAIII (In RAID array to store and backup workflow or processed images)