http://www.xboxfamily.com/news%20stories/HDD_Required.htm

I have no problem with this especially since everyone I know has a hardrive and by the time this becomes true I am sure the 20 gig will be cheaper as well as the 120 gig.  If a game needs a Hardrive so be it though I am sure some won't so the core will stay get some games :)

Doesnt cod4 need a hardrive?

They said it doesn't that it was used as a place holder for other labels etc. Again some people complain about the lack of hardrive for the 360 but I am certain most I would say over 75% havea hardrive and best of all have an option to just buy one when they decide they need it. I wouldn't be surprise if the core was just a way to sell in other markets and to appeal to that 10-25% percent who just coudn't afford to buy the $400 version for whatever reason.

If this is true then why are they still selling the core. It seems like core owners are getting shafted. Also I am pretty sure that many AAA games will use the hard drive, meaning that the core owners will be stuck with movie tie-ins and other crap. I guess if there aren't any core owners then there will be no one to buy their overly expensive hard drives.

The core is for people who can't see the overral picture or value in buying the premium. Someone might buy the core and buy the 120 gig drive as they don't care about hdmi and just want a 360 and more hardrive space. In the end it doesn't matter since the core people are not a huge number and those same people have the option of upgrading if this becomes true.

Those are some really good points and I see where you are comming from but I think Microsoft should drop the price of the hard drives so that core owners do not feel like they are getting the short end of the stick. As of now the hard drive isn't that necessary, as long as you have a memory card you can play any game (offline and online), only thing you are really missing out is the demos but now with downloadble content and games requiring hard drives, the core owners are missing out on alot. As a premium owner, I feel bad for core owners and I hope microsoft does something to prevent core owners from feeling left out.  

I don't feel bad for core owners only because it was their choice to buy the core. Again they are in the minority and I am sure the drives will go down in price so shouldn't be an issue if this comes true. The way I look at it if core get something then why can't premium get something as well since my 360 doesn't have that extra 100 gig or hdmi etc. I decided to buy a 360 before any of that stuff because I wanted to play certain games and I am sure is similar for the core folks who didn't pick the premium and where just fine with a core, gears and a memory card for example.  I know many people say they are getting ripped off from Microsoft but I really enjoyed playing the likes of gears, guitar hero, saints row and a few more game that I have so it was well worth money for me and I am sure others.  If there is anything I regret is that danm 40" LCD TV I bought for which I should have waited as it is about $1000 less now lol. 

What's worse is the price drop (though small) of the core as well as the other SKU's. If a big factor of the Wii is it's price, could the sales of the core jump a bit as well by it getting a little price cut especially if Microsoft isn't going to be getting rid of them (as they have claimed to debunk the rumors)?

I really think that one of the big mistakes MS did, is releasing a SKU without a HDD. Maybe if the HDD was in all 360s, MS could have avoided PGR4 size problems and giving Sony a shot to say that they were always right by choosing BD for the PS3...
Not forgetting that XBLA games would be able to use more space!

Microsoft was giving the consumer a choice to buy hard drive, there's a reason why there console is only 300buks, unlike sony that forces you to purchase the harddrive increasing the amount of money you would have to waste.