QUOTE(little miss modder @ May 30 2007, 07:45 AM)

but stealth isnt the issue in my opinion, i havent been banned and some of my backups are not stealth so how do u explain that? i wont be updating to this firmware simple because i survuved the banning and i reckon that this would get me cought. and it dosnt bother me if i get banned because my xbox is starting to die contsantly freezing so i'll play this update by ear
C4E has stated that they saw what Microsoft is currently doing using debug firmware. Microsoft **IS** checking those critical sectors, so playing with non-stealth backups **WILL** eventually result in a ban.
You might get by if the games that aren't stealthed are old games, and the updates haven't been written to check this (I'm of the opinion that the check may be taking place in the game updates, rather than the dashboard), but the latest dash update may have further increased the checks.
Updating won't get you banned. They currently aren't looking at that, and may never look at that... it's either too late, or it doesn't matter at this stage, so better to update now than later.
Some of the speculation is exactly that: speculation. C4E has discussed Microsoft's new query on the special sectors, and how it's changed, as well as the apparent checking of timing on challenge/response queries, so we know this is what is being used. We also know that many, many people have flashed after the update with no banning. We also know his testers did not get banned after reflashing. Updating is NOT the problem, especially if you have an MS28 with Firmguard (Microsoft cannot tell what you are running). The power on without DVD check was speculation (one I proposed when the bannings began, too), assuming the 360 stores error information, but when I speculated it, I also dismissed it as impractical, due to inevitable drive failures that would "Ban" your legit 360 under certain circumstances.