Should I roll my old 401k into a self-directed IRA?

[Robert Smith]

Hey BP,

I have $100k collecting dust in a 401k from a previous job. I'm considering either rolling this money into my current 401k (boring) or doing something more "real-estate-y" with it. I understand there are ways to put this money into a self-directed IRA/401k (thanks to a blurb in Anson Young's book on Finding and Funding Great Deals). And that this money can then be invested in real estate. I like the idea of hard/private money lending with this money for a couple of reasons:

1. Returns appear to be higher than the 1.5% this fund is getting YTD
2. Could provide experience about this process as a lender
3. Could help me foster relationships with players in this space to fuel my own real-estate goals (most important)

With those 3 goals in mind, what are some of the things I could do with this money? What are some of the pitfalls and gotchas involved? And is $100k even enough money to get in to this area?

Thanks