Note that these drives don't actually have a "performance issue" as you put it. The WD Caviar Green line is designed for low power/noise/heat and NOT for maximum performance. These are low-power ≤5400 rpm drives that cannot match the i/o performance or throughput of a higher-power performance HDD. If you need performance you should be looking at the WD Caviar Black series.
That said, for a TM backup the Green line is an excellent choice. For backups you usually don't require best performance. Instead you'd prefer your TM disk remain quiet and use little power. For an internal drive, especially if you're interested in disk performance, I'd rather not get a Green series drive. Black is excellent, Blue can be ok, and Seagate has a few nice Barracudas. Personally, I stopped considering Hitachi after I received so many DOA drives when we ordered a batch of 1TB drives a while ago for our servers.
I second the other suggestions regarding size. You want to make sure you buy an internal drive that will never fill up. Note that once free space goes <30% you're usually looking at severe performance reduction. Then, once you've settled on which capacity to get for the internal, chose a TM backup drive that's at least 50% larger than the internal disk. That way you should have roughly twice the backup space compared to the occupied space on your main drive. And that will be necessary if you want to have some simple version control (IOW sufficient TM history) and prevent excessive TM activity (when it's freeing up space on the backup drive).
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