I'm currently working out my idea for liquid cooling.
First of all, the heatpipe used on the xbox cpu is nothing like regular liquid cooling.
The only similarity is that they both use some sort of liquid to move heat from one place to another.
But the heatpipe cooler transports this to the top of the heatsink and then relies on aircooling to actually get the heat out of the xbox.
With regular watercooling the water takes the heat right out of the xbox, and then an external radiator gets rid of the heat and sends nice cool water back into the xbox. So there is no way of comparing those two, not even to start about the crappy heatsink used on the gpu.
Yesterday i opened up my xbox to take a closer look at it's inside.
What i found made me happy on one side and a bit sad at another side.
The cpu cooler is pretty easy to replace with watercooling. The xbox uses 4 mounting holes which are 6cm apart, so there are clamps that would fit.
The gpu is another story tho because the dvd-drive sits on top f the gpu, meaning the cooling block has to be very low profile.
There are some very low profile coolers with the hoses going in on the side and not on the top of the block.
These don't have proper mounting clamps tho, so you'd have to glue it to the gpu, which i personally think sucks.
My idea to solve this is to make one big cooling block to go over the gpu and the cpu, and then make the hoses attach to the block above the cpu, where there is plenty of room for the hoses to go out of the xbox.
This is how far i am atm. (started yesterday

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I'll have to find someone who can make the block for me, but i think a m8 of me has the right tools at his work so i'll have to get in touch with him soon

PS. i haven't seen a watercooled xbox360 yet btw.