[quote name='d3adliner']Thanks for your help, but that wont work. The PS3 automatically says it needs to be formatted because the drives are locked to the system they were orignally formatted on.[/quote]
Your right, If you want to replace your system with the 60G it would be best to do a system back up, then deactivate your old PS3 from all accounts. Then pop the 250g drive into the 60g unit, format and restore. Your files will be there now so no need to redownload but they wont work just yet.
Now log onto each account and start a download from the download list, it will activate your new system and you can cancel the download since you don't need to download everything again, you might need to repeat that with everything in the list....