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Yes, CoD4 looks/plays amazing. Only 1 problem: if you want to play it in 1080p, you need to turn off all other video output settings on your console to force 1080p out. Note that this doesn't work on every PS3 game and is unique to CoD4.

They stopped selling the 80GB one that plays PS2 games in August. You won't be able to play PS2 games on your PS3. That's why it was $100 cheaper than the previous 80 GB model. There was some other functionality removed, too.