There is always a reason.
I have had 2 modded Xboxes since the 2nd gen mods first appeared, and both have been running flawlessly on Live since before the day Live actually launched, as I was a beta tester.
I dunno what the actual reason you were banned was, and I don't really care. No one here wants to hear whining about it, because no matter what you say, there WAS a reason.
You get banned from Live, and it lists modded box as the reason, then you had something of your modded nature exposed, whether it be the mod turned on, or files in the wrong place on your HDD. Again... I don't really care.
You get banned from Halo 2 matchmaking, and you were either cheating, or you were involved with a party that was. If you got banned, you deserved it. Bungie can track cheaters, as can we all. Again... Have you actually seen bungie.net?
There have been no bans from Halo 2 matchmaking due to language, so you can rule that one out.