Well, let's see. The Xbox powers on when a signal from the front P/E board is sent to the PSU. The PSU by itself cannot boot the unit. Thus, something is going wrong somewhere between the power button and the motherboard. Most probably, something is short-circuiting - be it the button, traces or wires of the molex connecter. Have you ever done anything to the P/E board? Do you have another one with which to replace it as a test?