[citation][nom]welshmousepk[/nom]This seems like a great idea, but would 4gb be ebough for game updates and the like so you could still use xbox live for online gaming (the new halo and GoW games interest me).[/citation]4GB is plenty for game saves, game patches, even some XBLA games. You need more space if you're downloading full games, videos, etc. Even then, you still won't *necessarily* need a HDD. You can attach up to 2x 16GB USB sticks for additional storage.
For what you're talking about using it for, you wouldn't need a HDD.