Not necessarily but I think the point was the XBOX DVD drive is a lot more picky than the average set top DVD player.
Also, if you drop a bit playing back a DVD movie, you get some pixelation but the data flow continues. If you drop a bit on an XBOX game, the game will freeze due to a read error, so no, it really does make a difference what kind of DVD you are burning.
Lastly, I still think I remember a lot of problems with the 2500s as well. Didn't you have to get a new firmware as soon as the first 2500s came out? While I run hacked firmware in all my burners, seems to me like if you don't want to do anything funky (region free, burn slow media at high speeds, etc.), you should be able to use the drive out of the box without upgrading firmware or anything. The idea of buying a drive that immediately needs service/or a firmware upgrade just to get it to work out of the box seems pretty bad to me. The average user shouldn't have to worry about such things. If this wasn't the 2500 that had this problem, then I take back this comment, as I can't remember specifically.
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