I've actually been meaning to test mine to add to our compatibility list, I have that exact model bought in '06, I just haven't had the space to offload the data that's already on it. It's a very, very reliable drive that hasn't given me any issues in the years I've owned and used it. And I've used it a LOT. What was nice about these models is that there was no sleep mode built in. WD drives also have a very high success rate for running usb backups.
I have no reason to assume it isn't compatible, but I also can't say for sure that it does. Later models of this drive are reported as working and sister models (the passports) work great. But even if it doesn't work out, it's still a dependable drive that will last a long time so long as you treat it right.
Ps I just noticed the downgrading comment. I hope you were referring to something else, and disregard this if you were, but for safety sake: Downgrading from 4.2 is very, very dangerous to do, especially on a console that doesn't support Bootmii as boot2. Make sure you don't try to go to 3.2 or you will probably brick - your newer console can't support that firmware. 4.2 is capable of running everything homebrew related without consequence and there's just no reason to risk it. We don't want to see you end up in the bricked forum the week after xmas. I suggest you seriously reconsider downgrading and also read this article by mauifrog.