Creating large database of MD5 hash values

Hello,

I am creating a large database of MD5 hash values. I am a relative
newb with PostgreSQL (or any database for that matter). The schema and
operation will be quite simple -- only a few tables, probably no
stored procedures -- but I may easily end up with several hundred
million rows of hash values, possible even get into the billions. The
hash values will be organized into logical sets, with a many-many
relationship. I have some questions before I set out on this endeavor,
however, and would appreciate any and all feedback, including SWAGs,
WAGs, and outright lies. :-) I am trying to batch up operations as
much as possible, so I will largely be doing comparisons of whole
sets, with bulk COPY importing. I hope to avoid single hash value
lookup as much as possible.

1. Which datatype should I use to represent the hash value? UUIDs are
also 16 bytes...
2. Does it make sense to denormalize the hash set relationships?
3. Should I index?
4. What other data structure options would it make sense for me to choose?

Thanks in advance,

Jon