Just to throw in my experience...
My bro bought a 360 sometime early-mid 2006. Played it for a few months without even activating live. Tried the free 1 month gold trial and played using originals (console not modded at this stage).
I then flashed with maximus-garyopa 2.3 at the start of january (was on a silver live account at this stage). Now unfortunatly i can't remember if i had applied the fall update before this because i did not have the 360 hooked up to the lan all the time (but I would have updated the dash afterward if it wasn't already).
I've never played a multiplayer game using a backup (having a silver account prevents this anyway). I am pretty sure I've used backups that have not been media stealthed too (and im not sure it matters with hitachi fw anyway).
Then I heard about the disc jitter thing and decided to stop using live until I flashed my fw to the new release (I barely use live anyway but its nice to have). However I just turned the 360 on today and noticed that my bro had already updated to the latest may 9th dash! Not only that, but he played a backup since the update too, before I had a chance to flash the disc jitter fw. Note I still have not touched the firmware since my initial flashing.
Thankfully, however, I'm not banned! Although now I'm probably on the blacklist for the next ban session because of the new disc jitter detection
![tongue.gif](style_emoticons/default/tongue.gif)
So this presents a few scenarios:
1. MS just hasnt got around to banning my console id yet and they are batching them up for logistical reasons.
2. You don't get banned unless you have at some stage played a backup on live, and it looks like this detection scheme (PSN/PSI/DMI/other) has been there since the fall update or before it, or is in some game code on certain titles.
3. Certain firmware versions had some method of detection of backup discs via the dash, be they played over live or not.
There may be some implications in flashing the firmware depending on what dash you had at the time and I apologise for not being able to be clearer on that.
But anyway, if I am indeed in the clear, it appears that it is not the fact that you flash your firmware out of the box that helps you slide under the radar. In fact judging by the evidence from what I have read over the past few days (e.g. c4e saying modded firmware detection is most likely not possible and customer service reps saying modded fw is ok as long as you use originals) is that the 360's ability to interact with the dvd firmware is quite limited and that this marraige/hashing method is not the one ms are using. This is purely hypothetical and I could be wrong.
I am going to leave the lan cable unplugged so no futher interaction can occur with Big Brother and leave the firmware as is (I am assuming the damage any new detection methods can do has already been done) and I will report back on my ban status over the next few weeks.
Phew, all done!
Edit: Maybe I would have been banned had I flashed my firmware again before the spring update, but I don't want to try it now just in case this hash thing is correct and I escaped it the first time by having an old dash.