Yeah weird indeed. I had the exact same thing happen to me this morning. Maybe some virus or something set to this date. I had similar problems last year that I got a guy to fix and I'm wondering if that wasn't July 31st of last year. It was in the summer I remember....
Anyway, last year it had something to do with a bad dashboard and it might this time too. When I have that menu, MS dash, reboot, settings, etc. The buttons all function except the one for MS dashboard, clicking on it does nothing.
My mod which is that TSOP thing the guy did last year, with executor two BIOS is recognized at start-up and back-up games on dvdr play OK.
One thing I'd recommend is keep your xbox plugged in till you get this sorted out. I unplugged mine last year and when I plugged it back in it would no longer even boot up.