Serenity Painted Death said:
Coming out with a 360 with the external "movies only" HD-DVD drive makes no sense at all.
It makes sense, it makes financial sense.
If you already own a 360, and would like to get a HD-DVD player, you can buy the cheap external drive.
The only way it's non-sensical is if HD-DVD is DOA, if HD-DVD goes on to be successful, than it's a great add-on. It has nothing to do with game, but provides a cheap alternative to a standalone player.
It also does have some advantages over a combined system like PS3, for example you're laser will last longer as the movie playback is confined to the external drive, so you don't have to worry about wearing out your drive watching movies and eventually be unable to read discs.
Also, if they do it right it can also double as a PC compatible HD-DVD USB drive, which makes it an even better purchase.
I think it's a smooth move by MS, don't burden down the costs of the core console with unreliable expensive cutting edge disc drive, but still offer the functionality to those that want it by means of an add-on.
edit - i think a BR drive would've been a safer bet at this point in time, it would essential end the format wars, but they're gambling somewhat on hd-dvd. If it pays off, and somehow hd-dvd emerges as the successful format (doubtful) it will be looked back on as a brilliant move, sony will be put in a bad position with the PS3 the BR will remain costly for much longer. If BR wins, well MS hasn't really lost anything, except maybe some consumer confidence for selling them $200 paperweights.