My working theory regarding XBLA licensing goes likes this... The trail PIRS archives of XBLA games download uniformly (everyone gets an identical file - there's no personalization). When you 'purchase', a full license (a short file) is downloaded from XBL and stored in a 'license repository' (aka. 'key vault') stored in the FW on your console (maybe

[1])
(and mirrored on the XBL servers). Six bytes in the header of the XBLA PIRS archive are modified to hold the index (hash) of the newly stored license.
When the XBLA game is executed, it uses the index/hash in the archive header to swiftly consult the console's key vault, and if the license is valid for the game, plays the full version, else,
and if online, it consults the XBL server held key vault related to your profile, else trail only.
So you can move 'purchased' XBLA PIRS archives between consoles, but because the 2nd console's key vault will not contain license at the given index/hash location, it'll only play as trail (assuming different profile and/or offline!)
[1] I'm still unsure if a physical key vault is actually maintained/necessary. The bytes updated in the purchased XBLA PIRS archive's header may be being used in concert with the unique console serial number, and via some algorithm achieve a
logical binding, rather than maintain a physical license vault. This theory is easy enough to check, but would involve unsoldering and dumping the consoles FW before and after an XBLA purchase to check for changes, which is beyond my abilities.

Interesting. Care to explain how the full versions games run off the Live Arcade Unplugged DVD? Clearly these versions work without such key vaults.
Also, does this mean that if I buy a Live Arcade game, I'll only be able to play the full version when I'm online?
xbox-scene is realy starting to lose it
this whas found out a couple weeks ago
but its not realy usefull.......
I see you joined 3 minutes before making this your first post.. but its not really useful!