A forum user on High-Def Digest posted a scan from next week’s K-Mart weekly circular ad and it shows a price drop of $50 on the Xbox 360 Premium. Yes, the $299 price you see still includes a 20GB hard drive.
The timing of this apparent price drop seems to sync up with whatever announcements Microsoft will have at E3. The rumors on that front include a price drop or a newer version with more storage. The scan makes no mention of price adjustments for the ‘Arcade’ or ‘Elite’ models, but we expect they will be adjusted.