So like alot of people I have modded my xbox, put in a 120Gb disk and mainly use it for watching movies with the excellent XBMC software.
Doing a search actually brought back results for this,and its the first time that I have heard about it.
http://www.microsoft.com/windowsxp/mediacenter/evaluation/devices/xboxextenderkit.asp
So it looks like Microsoft are getting in on the action aswell, and what particularly interests me is the integration with Windows Media Center. Although I don’t have that running (and I am hoping to at some point get the Linux version running) it makes the whole offering even more attractive.