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Interesting thought of why they are dropping the price only 50 bucks:

The new Halo 3 SKU.

I have the feeling the new Halo 3 SKU will be the first 360 to receive "falcon" parts. The falcon will probably introduce HDMI across all SKUs when it is in full production. The Halo 3 SKU will likely retail at the normal 399 price while the premiums will be down to 349.

I don't know if the Core will get a price cut or if the Elite SKU will drop an entire 50 bucks. I would guess something like:

Elite SKU = 449
Core SKU = 299 + memory card + game (?)

Then, their pricing scheme would be: 449, 399(limited), 349, 299

Then, when "falcon" is being produced for all SKUs, 50 dollar drops for Premium and Elite, 100 for Core: 399, 299, 199.