Save up the extra $100 and get the premium. Almost all games require the HD to save. You can save to a memory card, but that costs $30, so for an extra $70, you get a whole lot more stuff.
Wireless controllers FTMFW! I have 4 wireless controllers and they're great. Don't really go through too many batteries (and I buy the off brand 24 pack for $4 at work). Definitely go wireless IMO.
Games: Depends on what you're in to. Gears of War, Crackdown (should call it Crack, it's addicting), any sports games look amazing, Call of Duty 3 (okay, too linear for my tastes), the list goes on and on.
I would recommend a USB cooler of some kind, either one of the ones designed for the 360 or just a standard cooler. Mine sits on a cooling pad powered by USB on all the time; my 360 would sometimes freeze after long sessions (usually during EA sports games) but has not frozen in over 3 months since I started using the USB pad.
Any more Q's let me know.