It really depends on the laws set forth by your country and/or state.
Enter DMCA...
If you are in America, it is perfectly legal to modify your hardware whichever way you choose with some caveats. This means you can add or remove any components as long as you don't infringe upon the intellectual property rights of another individual or corporation while doing so or make it possible to circumvent copyright protection. This means you cannot redistribute files containing copyrighted code legally, but it is perfectly legal to install the JTAG hack wiring by itself (flashing something like XBReboot is a different story).
What _IS_ illegal in America is breaking any form of digital copy protection, even for the purpose of making a legal backup. It's a catch-22, and like many of our laws, nobody really knows for sure what is fair use and what isn't. I am not a lawyer, and I'm not well-versed in this area, but as far as I know, there has not been any precedent set yet for the legality of breaking DRM for personal backup use.
That said, the FBI isn't going to knock down your door for flashing ripping firmware to a spare 360 drive if you're making backups for yourself or soldering in a few diodes onto your mainboard.
What CAN and will get you in trouble is advertising modification services in highly public places like Craiglist. While it is legal to flash the firmware, you can bet your ass that the prosecution is going to pin you as a piracy king-pin and will make every attempt to show the court that you knowingly and willingly modify consoles in order to monetarily benefit from piracy. Google "Matthew Lloyd Crippen"
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Topic: Is Jtag Legal? (Read 53 times)