I'm suspecting, seeing as the unit won't do anything computationally intensive (like ripping) that the box is basically a Neo35 (well, Neo25 now - the display is the same as the new Neo25's one) with both the CDROM and HDD attached to the single IDE channel.

Hence you can copy MP3 files from the CD to the HDD and do all the usual Neo things (bad shuffle play, not a lot of caching, etc), but it still uses a 3507 for audio decode so you just get MP3 playback only, no EQ, etc.

Yes, the Neo35 can use 3.5" hard drives. I could comment on how unadvisable it is to use a 3.5" drive in a mobile environment at this point (and how the 12v supply for the drives is badly regulated)... the lack of emplode as a manager is a major disadvantage (IMHO); extra metadata and structure is very hard to apply to a plain storage device (you'll see a lot more of this stuff becoming very useful in 1.1).

Hugo