The Google HDD Study is a little difficult to follow without some statistical analysis. The graph (from the study) that best shows the situation is this one:
What it shows is that during the 6 month to 2 year timeframe, when a hard drive is still in the prime of it's life, that annual failure rate is HIGHER at 30-35 degrees C than it is for higher (35-40, 40-45, and 45C+) temperature ranges. It also clearly shows that as a HDD ages into 3 years and 4 years, that temperature plays a more important role in AFR% and you can see in the graph that "cooler is better".
Looking at the graphs, the sweet spot is 35-40C on average, and 30-35C as drives get older.
(Credits for graph: http://storagemojo.com/2007/02/19/googles-disk-failure-experience/