I wound up swapping it with the spare drive, and went and rebuilt the array again. After about an hour and a half (not bad for 74gigs) the array was in an OK state. The entire procedure with the first failed rebuild and the second rebuild took about 10 minutes. Now MX1's uptime is only 99.27% darn.
It is kind of distressing to see the drive die so quickly as it has only been in production for about 2 months. I guess using cheap desktop SATA drives has it's drawbacks. However those damn SCSCI setups are so expensive.
Phrax Blog (Benson Wong): Another victory for Hardware RAID
Ben's been churning through all sorts of good IT solutions that balance do-it-yourself against cost. The SCSI vs. SATA debate will rage on, but cheap wins over expensive if you can use techniques like hardware RAID and spare drives to maintain good reliability.