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 An update on an earlier story we had, it looks like the Xbox 360 Arcade model is real, as it has been spotted on shelves at stores. Microsoft apparently is utilizing the stealth release approach that worked oh so well for Sony's Playstation 3 price drop. As previously reported, the system will include five games from Microsoft's Xbox Live Arcade service (Boom-Boom Rocket, Pac-man, Uno, Feeding Frenzy, and Luxor 2), a 256MB memory card, and a wireless controller, all for the price of $279.99. So, the console game has just got even more confusing... Source: ShackNews
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The good news is that there's now another Xbox Live Disc of games out there for us "collectors" 
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Now, the next step: confirmed hardware revision that results in system reliability. If the Xbox 360 had system reliability, this bundle could be a home run as nearing the "sweet spot" at retail.
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Sweet only 30 more then the Wii. That should help sell some systems.
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@Gentlegamer:
They're already working on the "Falcon" motherboard style, which is something like the 360's fourth major revision.
I still think this bundle is somewhat worthless as gamesaves and video demos fill up the 20GB hard drive rather quickly.
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