Creating subsites for each registered user

I want to make a website that allows users to sign up, and upon their sign up create a sub site for them where they can edit content and theme at user1.website.com.

If a visitor goes to user1.website.com, they only see the content that user1 has added / edited.

So far, my idea is to do the following:

ONE
Use subsites module : www.drupal.org/project/subsites
Create a custom trigger that when a user registers, creates a new subsite.

TWO
Use a php script that when a user registers, a Drupal subsite is created within website.com/sites and its database information is generated

Ideas?