Pretty much any USB 3.0 hard drive is going to suit you well. I can't remember the site that did a breakdown, but the result was that you really should consider price per TB. None of them are noticeably better. I bought a 2 TB Passport at Best Buy for around $90. One TB was around $60.
As for XBL, Microsoft is selling year subscriptions for $40 right now. It's unclear how long the sale lasts.

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