Ok, It is NOT a server issue. Nor coincedence.. I did repeated tests. Here are my findings:
Starting at Noon today on a NEVER BEEN MODDED Xbox.
12pm - Xbox LIVE retail version WORKING on the new retail servers. (didn't try the beta disc)
12:30pm today - flashed Matrix modchip with EvoX2.5 color bios, installed. Works. (see orange/red Xbox logo)
12:45pm - Launch MotoGP Online Demo Retail disc. Select my username, long pause, "Your Xbox console cannot connect to Xbox Live".
12:50pm - Removed Matrix completely, launch same MotoGP disc, Xbox Live WORKS.
1:00pm - Install Matrix, set to "Swap Mode". Launch MotoGP retail disc, "Your Xbox console cannot connect to Xbox Live". Hit Eject, push tray back in, launch MotoGP, and I get in!
This cannot be a coincidence!!!!
P.S. The connection test in the dashboard works. Says Connected regardless of bios mod.
-Sarkoon