This brings a concern to mind now that I think about it even further. I think this falls under modchip developement or does it fall under false advertising? You decide.
The NME 1.2 is supposed to detect a backup - then "fall asleep". This would tell me that I should be able to open the dvd rom drive, pop in an original without a cold boot and the drive should function as stock. However it does not. Once I boot from a backup and put the chip / drive into "read a backup mode" - I have to cold boot it to return it to "normal operation" and read an original disc.
Here's the problem with that. This leaves the box in a "read a backup state". You'd think that MS could send a command to the DVD ROM to detect that state and ban those from live in the future. If the drive does not return to "normal" mode after booting a backup - it's not truley stealth. The only piece making it stealth is turning off the network controller via the "optional" wire soldered to the motherboard.
So, do we have a design flaw here or is this just shoddy advertising on Team-Underdogs part? I agree that this chip is great and does a wonderful job at booting my backups etc. However, They advertise that you don't have to change anything on the chip for drive detection - however if you own a samsung drive in your 360 you have to set the chip to "samsung" mode. That's not auto detection by any means. The drive not resetting back to normal mode after a backup boot - is not stealth either.
So my final statement would be "Use this on live at your own risk".

It works great - but I forsee it being detectable in the future if you don't have the NIC disable option installed.
Another 3 cents from me.
Regards,
Sncboom2k