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A large portion is for the OS and software which runs on there, and an even larger amount is for developers to use to cache data as the hard drive is quick it works out quicker for them to dump a lot of data to the hard drive.
I did have the exact amounts somewhere, but can't find them now.
thats the bloody x-box for ya they have cut back to much on the console and in a years time people with either buy an updated version of it or have to buy upgrades for it. it going to date far to quick for my likeing