The HDMI thing is a myth, apart from the Hard Drive they are pretty much equal. Oddly enough, HD gaming out of the box is no longer possible as no console now comes packaged with a required lead to jump straight into HD.
Only the Elite and Arcade now exists, but to muddy the waters some stores bundle the Live Starter Kit with the Arcade, which adds a 60gb HD, 3 month Gold membership, headset and cable.
iirc the Arcade RRP is £149.99 and the Elite is £199.99, some stores add the 60gb kit to the Arcade for about a tenner.