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It seems to have nothing to do with the controller, does the same for USB or Wireless or Madcatz, etc. This is a consistent issue... start up the box, you can play with the dash as long as you want or let a game run in demo mode for as long as you want BUT after 10-15 minutes of gameplay, freeze. Restart, it will run forever... weird weird problem... same no matter what game you play.
Yeah, it looks like your 360 will become one of the 3 red lights of death stories... Its most likely a solder joint underneath a chip going bad. Expect the problem to get worse, and eventaully, youll get the 3 red lights.
After that theres a few options, X clamp replacement, pay someone to do the x clamp replacement, send it to M$, or just buy a new one. If you have any warrenty, try to claim it, you should even just try and ring up M$ and check with them that your 360 is out of warrenty.
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I turned the 360 (cold boot) and loaded up Gears of War. Loaded a level and left it on overnight. Woke up to find that the system was working like normal. Only when I started controlling the character, within minutes it would lock up like the situation in my first post where a reboot would fix the problem.
Interesting. And now heres my theory on that. I would suspect a bad RAM chip. When you loaded up the game and left it overnight, it obviously wasnt doing much work. So, when you started playing the game in the morning, it made the console work harder. Also, when you play the game, variables stored in the RAM can change thousands or millions of times a second. If you have one little part of the memory that is bad and gives the wrong variable, it can cause the game to freeze.
When it freezes are there any weird things that happen on the screen (and artifacts, eg lines, checkerboard pattern of dots, weird colors, etc...)
Also, what part of the game was the 360 in when you left it overnight? (was it just on the menu of the game, or in the game, or just paused?)
Hope that helps...