BBoAH says "1 x Internal 880K (Actually a PC 1.44MB drive converted for Amiga use)". I wonder how "converted", still function as 1.44?
They did the same thing in the A1200, I would imagine
http://aminet.net/package/docs/hard/HiDensity works as well.
GCR fits more data in the same space as MFM, however on the DD floppy drives you have to then slow it down because of reliability issues. I believe on the HD drives you don't have to & this is how you end up with more usable space.
tldr; it is physically a PC 1.44mb floppy drive, but the floppy controller on the Amiga can only write at DD speed. The conversion they do is just to get disk change etc working, which is just a wiring change. A "1.44mb drive" is the wrong name for it though, you can fit more data on it that that it's just the floppy controller on the PC by default uses a layout which gives you that size.
On the A1200 they did the wiring change on the motherboard, so the drive wasn't even converted. I thought they did it like that on the A4000T too, but they might have changed the drive.