The rumor that Microoft is releasing a black Xbox 360 with 120GB HDD and HDMI is getting new fuel from print magazine Game Informer.

Game Informer writes in their current issue that Microsoft plans to introduce this new more advanced Xbox 360 for $479.
There will be still no HD DVD drive inside.
Kotaku features scans from the Game Informer Magazine showing the article about the black Xbox 360.

The current Xbox 360 premium with 20GB HDD sells for $399.99. With $479 the new Xbox 360 would be still cheaper than a 60GB Sony PS3. Now if MS would have HD DVD inside that would really pressure Sony to drop the price.
Yesterday's announcement of Toshiba dropping the price of their entry-level HD DVD player also does not quite put enough pressure on Sony yet.

I am pretty sure that Sony would need to act if Microsoft puts HD DVD inside the Xbox 360 and stand-alone HD DVD players will sell for $250.