Become a MacRumors Supporter for $50/year with no ads, ability to filter front page stories, and private forums.
What does that mean exactly? What kind of HDD's WILL work?

It means the shape and electrical connector of the drive in the MacBook Air is non-standard.

There are (literally?) a couple of companies that make replacement/upgrade drives. I think OWC is one of them but you might want to avoid them due to poor quality. But I haven't been following this closely so I can't give you any more advice than that. I just know the Samsung drive won't work.
 
I recently bought a 13" MBA with every intent of upgrading the SSD and memory. I then found out (after purchasing) the laptop isn't able to have either upgraded. I was really bummed at first but I got over it. I only paid $720 for the laptop new at Best Buy and so far I'm really liking the laptop.
 
Register on MacRumors! This sidebar will go away, and you'll see fewer ads.