I just use the account functionality to separate, but symlinks would work too (as mentioned above) and are also easy to set-up. Or perhaps look into using something like sx tools to perform the transactions through bitcoind rather than bitcoind itself.

The accounts code does not scale up to thousands of accounts with tens of thousands of transactions, because by-account (and by-account-by-time) indices are not implemented. So many operations (like computing an account balance) require accessing every wallet transaction.