Text (ON+errata): Draw X cards. For each card drawn this way, discard a card unless you sacrifice a permanent. [Oracle 2005/08/01]
You draw the cards, then sacrifice any permanents you want to sacrifice, then discard the required number of card from your hand. [Onslaught FAQ 2002/09/24] There is no chance to play any cards in between these actions. [D'Angelo 2002/10/15]
You are never forced to sacrifice any cards. You can choose to discard your entire hand if your hand is smaller than the number of cards you are required to discard. [Onslaught FAQ 2002/09/24]