Can I configure an SSD and HDD to be one logic volume in Lion? I recently purchased a 120GB SSD that will replace my optical drive in my MBP. It also has a 500GB 7200RPM hard drive.

Is it possible to have a single logical volume that uses both physical disks in Lion. If so, would I be able to still specify that the OS and Applications be installed on the SSD while all other large files reside on the HDD, and how would I do it?
You certainly can make two or more physical drives into one volume that the OS sees. It's referred to as a concatenated disk set - and Disk Utility will erase both drives in preparation for a RAID - you can choose an actual RAID stripe or simple concatenation.

Since Macs won't boot from a RAID volume without some additional hardware or extra software ( to handle the added complexity that RAID entails ), you won't be able to use this for your boot volume. 

Even if you could, I wouldn't advise doing this since the OS decides where to store files inside any volume. If your goal is to control what files go to the SSD and which to the HDD - this doesn't get you any closer to that goal. 

The good news is there is an excellent "Plan B" for you



The best writing I have seen recently on how to both think about using a SSD with a HDD that also covers how exactly to implement a split was written recently by Matt Legend Gemmell - He really knows his stuff in general and his article titled Using OS X with an SSD plus HDD setup is great reading.

Matt advocates 


installing the OS and most user data on the SSD 
place user data that won't fit on the SSD instead on the HDD
implementing this by moving entire top level folders from the SSD home folder and placing them on the HDD. 
using soft (sym) links to connect the two locations.


I hope that gives you a better solution to what I see as the major thrust to your question. You might also look at using Aliases (OS X Finder's enhanced version of a sym link that points at unique characteristics of the file as well as the path in case either gets moved and the system can figure out (re-link) to the correct/new location of the file.)