Hi Ian!
Great questions, thank you! It totally makes sense, and we are working(https://github.com/dataversioncontrol/dvc/issues/706, https://github.com/dataversioncontrol/dvc/issues/705) on supporting external dependencies/outputs right now(including s3/gcp/sftp/hdfs support, as well as local files outside of repo). The support for those is scheduled for 0.9.8(we have 0.9.7 scheduled for this week, so 0.9.8 should be ready around early June).
You are totally correct about hardlinks, however, in your particular scenario outputs lay outside of your repo, so if the desired cache dir can be placed in the same fs that your outputs are placed, dvc could utilize the most efficient way(i.e. reflink/hardlink/symlink/copy) in the future. Just note that this is not implemented yet, so we still need to figure out particular details.
Cheers,
Ruslan