I use the WD my book version of this, it has an on off switch which I like as I don't always us my ATV daily so when I am not planning on using it I turn off the HD's. They are really quite and don't heat up much. Mine are sitting in my bookcases right behind my apple tv and they only get warm and that is after they have been on for hours.
This is the one I use I see they bumped up the price. I paid $149 Canadian 2 weeks ago...lol
http://www.bestbuy.ca/catalog/prodd...75E003D5&sku_id=0926INGFS10131306&catid=26259
In the last week I've gone through two of these WD MyBook 1.5TB drives from Best Buy (the USB, Firewire, eSATA version, model WDH1CS15000N). Both ended up being defective. The first sample developed a noticeable, constant clicking sound after about a day of use (interestingly, the clicking only happened while the drive was inactive, I think it was trying to park the actuator head which failed and then got stuck in an endless loop -- click-click-click trying to reset the head).
The other sample was basically DOA, wouldn't mount on the desktop. Also, based upon my experience with the first drive (which did work for about one day) these units will definitely go into sleep mode after a period of inactivity. Frankly, I don't think you are going to find any external drive that doesn't behave that way.
In any case, after being a long time Western Digital fan this latest experience is making me think that these particular drives are VERY cheaply made. I suspect that they use a custom drive mechanism designed for lowest possible cost. Western Digital has done a similar thing with their 2.5" Passport external drives (they no longer use a regular SATA interface, presumably so that they can reduce the cost of the product). From now on I think I'll stick with bare drives so that I know what I'm getting (RPM, cache, interface) and then purchase a good third-party enclosure which has the features that I want (like a real power switch -- the Western Digital power switch only works after you install custom software on your Mac). I also dislike the fact that many of Western Digital's external drives now force you to install custom software on your Mac so that they'll perform automatic backups -- what I want is a simple (dumb?) drive that does what I want, not something that does what Western Digital thinks it should do.
I'm going to try and exchange the drive once again at Best Buy (I suspect they may give me some trouble since this will be my third attempt to get a correctly functioning drive) but I have a rather sinking feeling that the third drive won't be any good either -- the odds don't look very good.