At $38.99 for a 160GB drive, they're paying $0.244/GB, which is pretty bad. Of course, at the low end of the price ranges, the price/capacity ratio goes up a lot.
Their part selection still leaves another $7.05 available, which means you could afford a drive up to $46.04. For that price, you could get a Hitachi Deskstar 500GB 7200RPM drive for $42.99 ($0.086/GB). If you don't like Hitachi, there is a Western Digital Caviar Blue 500GB for $44.95 ($0.09/GB).
During the evenings I've been working on a site that tracks hard drive prices and price/capacity ratios (http://pcpartpicker.com/partscharts/internal-hard-drive/over...). If you're willing to spend over $80, you can get drives at $0.053/GB.