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Microsoft - Hard Drives - View Post

DLC for certain games can be about 1GB (Fallout 3, GTA4, mappacks for Halo 3 & CoD4)

You can also download movies and XboxLive Arcade games (but they aren't that huge) and well now you can copy a game to your harddrive.
The result is your game will see a boost in loading speed while playing. (Some games are more affected by this than others)

For some games a HDD is required ! (Halo 3 co-op, Burnout Paradise and 2 others I think)

I would recommend a 60GB HDD, so go for the Pro model.