When your console is chipped, things are really simple:
1. If you have a PC with an IDE connection, use this:
a. Unlock your 160gb hdd (if it is locked).
b. Connect it to your PC's IDE connection.
c. Get any 1:1 disc cloning program like Acronis True Image. I use a free tool called SelfImage.
d. Clone the hdd to image file.
e. Switch over to 250gb hdd.
f. Dump the cloned image to 250gb hdd.
g. Swap the 250gb hdd over to xbox.
h. Lock it if you want.
2. If you only have your xbox, use this:
a. Get chimp26 and molex power splitter (or borrow power from USB/IDE enclosure) to power 250gb hdd
b. Skip to step d if yours is not a xbox ver 1.6.
c. Get a crossover Ethernet cable. Configure PC IP address to 192.168.0.2. Telnet to 192.168.0.3
d. Run chimp's default.xbe.
e. Hotswap DVD IDE to 250gb hdd.
f. Use number options (1,2,3,4) to select the options you want. Or use the controller to select.
g. Lock it if you want when cloning done.
h. Swap over the 250gb to hdd IDE connection. (You can power off to do this, no need hotswap)