I actually want to play Final Fantasy XI on my 360 but my hard drive space is limited already.

Designer are learning more and more about the PS3's Hardware everyday and how to use it efficiently. I think we will start seeing more game now that don't require a install to play. Also to answer your main question the size of installs never scares me nor my PS3 away from a game because I have a 250gb HDD.

I never cared. If I'm running out of space on my 40 gig HDD i just delete trailers and stuff i'm rather not going to play again.

I'll replace that HDD but I'm still waiting for cheaper ssd drives ;)

Nope not yet (I have an 80 GB HD)

Not at all.

500gig 2.5" HDD is only like 70some dollars.....