Zander:
I can verify that the MAC address is directly tied to the serial number of the Xbox.
I've been able to generate a valid eeprom (but not valid as far as XBLive is concerned) by decrementing the low order byte of one number in the serial and the incrementing a byte in an adjacent low order byte of another number.
This old CRC trick gets the Xbox to accept the checksum and headers as being correct. However the MAC then is seen as screwed up.
By performing the same trick on the MAC address you can get a working eeprom. However there is something more to it than this, somehow the header values (I believe) are tied to the Serial/Mac keys, although it could well be that the online serialization is at fault as I have not had a chance to try this.
So far EVERYTHING you have said mimics what I have seen in packet sniffing attempts, though you are now a bit further than me.
Yes, there -ARE- holes all over the place eh?
I'd imagine a linux patch sending the same packets obtained during an initial negociation of an unmodded (or better yet modded system with the chip switched off but the drive locked) would do the trick as the eeprom values which are sent do not change subsequently.
If we could intercept the exact sequence which gets the Xbox to reveal if it is modded or not, then a filter of some sort may be possible that would replace the "I'm modded" packets with ones from a virgin Xbox (e.g. from the same Xbox before modding), and BANG... Kerberos is none the wiser.
Great stuff BTW!