There are 9.5mm height 2.5" drives and 12.5mm drives, but any drive 500GB or less will be the standard 9.5mm height. Typically only the 1TB 2.5" drives are 12.5mm.
You can find 500GB drives for less than $60 on Newegg, so there's really no reason to go any lower in capacity.
http://www.newegg.com/Product/Product.aspx?Item=N82E16822152209
http://www.newegg.com/Product/Product.aspx?Item=N82E16822145257
http://www.newegg.com/Product/Product.aspx?Item=N82E16822148371
PS3 repairs are $150 plus shipping/handling. If you haven't had any problems with your system, then basic things like letting it cool down after extended periods of running on high load (playing games, Folding, etc.) in the XMB before shutting it off, keeping the vents clear of dust (if your fans are running louder than usual, the console is running hot; heat sinks may be clogged up) and keeping the console ventilated (not in a closed cabinet) should prevent the overheating that leads to YLoD failures.
