You should have no problem keeping your HD and replacing your 360, mine just died and went to Microsoft for repair/replacement whatever, kept my HD at home.
My nephew took his back today to a high street game store. I was waiting for the call to say that he would have to send it back to MS. I had pre-armed them with the SOGA. Its only 5 months old and was sucking discs into the back of the 360 and trashed his pro evo.
The game store replaced the 360 let him keep his HDD and replaced the Pro Evo. I was shocked. My brother in law said the guy in the shop said that MS had now instructed them to replace 360's in store and forward the bad ones onto them.
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