ive got v1.1 xbox and the matrix and this is how i got it working....
firstly filled the LPC holes up with solder , then flashed a colour bios to my chip.
then , dont trust ANY of the alignment lights.....I used to get the brief flash of green before i filled in the LPC holes, and my chip didnt work then....
anyway , line up your matrix in mode 2 (dip 1 , 2 off (i think!?!?!?) then when you *think* its lined up properly, switch on your xbox with hard drive and dvd drive plugged in , and see if it boots! you'll know if it is aligned because your xbox logo will be a different colour.
Another tip, this helped me slightly when i had to reflash my chip and had to align it again...
when screwing the chip down with the original screw, you will see 4 dots around the screw which are on the
matrix top , if you aim to get the screw in the centre of these dots and SLIGHTLY to the left, it should be a good tip, it works for me everytime.
also the bottom of the chip should be parallel to the dvd drive IDE port but about 2mm away from it....
hope this helped , its how i got mine working....