Ok heres the deal, if your using a pc with a router and your xbox is pluged into the router, you more than likely have an ip adress like 192.168.0.* to your xbox...
When evox is first ran it resets your IP, to whatever is set in its *.ini, so if you run a game from your HDD, the system STILL has the IP from that. I know this becuase every time I "flip the switch" to go on live, I get the "cannot connect to live" and then it goes to the trouble shooter, where it shows that my IP settings are on MANUAL and set to what EVoX had. When I put it back on automatic, I am connected.
Another great way to bypass Live with the chip on is to have a password for your acct.