Well hot diggity damn. This is what appears to be a picture of an updated Xbox 360 that features an HDMI port and 120GB hard drive. The Microsoft insider who leaked this information said the Zephyr 360 should be available "soon." There isn't much else known, but once we find out, we will be all over it like a fat kid on cake.
Early 'dopters, I'll bet you your consoles that theres a Built-in HD-DVD drive in there too. Its clear that they are trying to steal PS3's thunder, or at least trying to be more competitive when judicious buyers stack the two systems side by side. Its very clear that this console war is not nearly over.
It could also be that this was planned from the get-go, and because of not being able to meet their deadlines, they rushed an early version out the door to satisfy consumers and also beat PS3 and Wii to market.
Early adopters can suck eggs.
Also, if you haven't bought either system and are swayed more toward the 360 because of this, I'd wait till around March when Sony drops a competitively updated PS3.
This could go on and on.