I do not personally think it'll make that much difference, and here's why-
The biggest spacer eater on any game at the moment is video, and what this actually adds in terms of game play is very, very little.
Now ok with the Xbox being HD ready you'd in theory need more storage space to holder the even bigger movies this will enable, but what if you could repalce these videos with instead real-time graphic based interludes? The 360 is more than capable of this and the space used as the game engine and graphics willl already be there is again very little.
The biggest problem that we'll have here is lazy, wasteful programming were software houses find it easier to hire a CG film house to add their video, and of course the industry standard attitude of lets do so thing that can be ported with as little work as possible to every console and the use of off the shelf solitutions to this ends (does no one write bespoke code these days!).
Yeah I know but lik I said though as a huge RPG fan the 360 might not be for me. The only posible good thing to come out of this is modding will be a LOT easier as backups of DVD's is already out and also softmod installers etc would run better hopefully they don't have tha crappy drive they use in current xbox's.