nope nope
No, they are 2 different things.
no, only as media share.
no the hardrive you plug into your xbox 360 can only be used to play music, films and pictures from the hardrive on your xbox 360 you can not play any games nor store any xbox 360 data on the hardrive.
Yes you can.
You need a hardrive. Hardrive
yes
NO it does not
Some only if you have the Xbox 360 Hardrive and some software downloaded from the Xbox 360 to the Xbox.
how does the hard drive actually work on the Xbox 360 console?
yes you can put an xbox 360 harddrive into an arcade 360
In the hardrive in the console.
The latest model: The 250GB hardrive