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can this be done via SATA only or do I need to use the CK3 kit every time ?
Once a lite-on is flashed the ck3 kit is not needed again. You could save the key and you can read it via sata once you have ixtreme.
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do I need to erase the Lite-On and re-flash it every time or just write over the existing firmware ?
Yes future update will have you erase then write.
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If so, would I just press the 360 on/off button real quick to perform the power cycle ?
no 360 must stay on, you would be pulling the power cord out of the drive and plugging it back in if your case was open. You will need to figure out a switch.
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--> besides that the update process for the Samsung can just be done via SATA without any hassle (so I would not need to take the 360 apart every time I update) are there any other advantages to the Samsung ?
No, only disadvantages. I am not sure if it is even safe to go on live with a spoofed lite-on.
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does the Lite-On read backups as well as the Samsung, considering I use quality media and my Lite-On was manufactured in March 2009 ?
The lite-on is considered to be the best drive for media compatibility.
iXtreme updates are very rare. I think you would be wasting alot of time doing this mod. Seriously it takes less than 5 minutes to open the 360.