Only official Microsoft/Seagate branded Xbox 360 hard drives are guaranteed to work. Standard off-the-shelf Seagate SATA drives require modification and are not officially supported.
You can use a standard 2.5" SATA HDD (up to 2 TB) if you:
Buy a used official 250/320/500 GB drive (~$25–$45). Reliable, plug-and-play, no ban risk. USB flash drives (up to 2 TB, formatted as FAT32) work for game installs/saves without hacking.