That's exactly what I'm going to do. I received the email last week as well on my machine. I called the Apple Authorized service provider here in town (we don't have an Apple store...yet), and they're aware of the issue and standing by for replacement...I asked if I could provide my own drive. They said "No problem!"...I stopped by Amazon yesterday and picked up a 3TB Seagate XT for $169!! Incredible deal with free shipping and triple the internal capacity. Obviously I could've accepted the "Free" replacement drive from Apple...but like others, I'm a bit nervous to have them open my iMac up. I've had this same shop upgrade another one of my iMac drives in the past (went well, fast, and NO dust or screen issues)...so I'm more confident than others...however, I only want to do this ONE time! Hence, a BIG friggin' drive that I'm going to have a lot of fun filling up! Something to consider...as others have also mentioned, now is the time to put that SSD or bigger HDD in your iMac if they are going to crack it open. YMMV as always😉
J