I doubt it will take anywhere near that unless you do some kind of disk-wiping also. Even ext3 on a 1Tb disk takes around ~45 mins, but that is just due to the behavior of that particular file system (xfs and others are pretty much instantaneous, for instance)
But please note that Sony has chosen to restrict access to the RSX chip (the GPU) completely, so you will not get any "wow" factor out of the new installation as everything will be handled by the CPU. (No 3D optimizations, no ability to emulate newer games, and generally much, much slower performance than the PS3 is actually capable of delivering)
You can use part of the RSX _memory_ though for tmpfs, which does speed things up a bit (with the exception of graphics)