First, just so that you know, you'll have to format those drives to make a new RAID partition, so all of the data on them will be lost. Secondly, yes, you will lose 40GB on the 120GB drive, for a total of 160GB between the two. If you're still sure that you don't mind losing 40GB of space, then take a look at this
Tom's Hardware Guide review of RAID cards. Really, any card will work, but this should give you an idea. For an even more reputable source (Tom's is OK, but I don't like it as much as many others) go to
Storage Review.com and take a look at the reviews from 2001. They reviewed a few from that year.