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The 360 Premium ('Pro') and Elite versions play about 300 original Xbox games. The arcade does not play old games, so I would rule that version out. The arcade doesn't come with a hard drive either, so its a waste of time if you want to use Xbox live to download games, demos, videos etc., which is one of the best bits about owning a 360! I can't say how well they run the old Xbox games, although I would presume they run fine seeing as the hardware is better. I think the xbox website has a list of all the compatible games...
Cheers
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