We've all seen these noobs posting topics about "creating" an x-box live server and as the rest of us know that's impossible. For every game you supported, you'd have to reverse engineer the protocol because that's not universal and every game will have their own layout of packet formatting. It's not gonna happen so don't get your hopes up.
However I think it is possible to create a client with extremely limited capabilities. Think of it this way: suppose you wanted to create a stats hacker. This would require:
1) Authenticating to your account
2) Telling the main server that your creating your own server
3) Telling the main server that you played a game and here are the new stats
Seems possible if you could get past the damn encryption that the packets have in place. This is what I've done:
1) Got a crossover cable (made my own from a standard since there were none readily available

2) Used ICS to share my wireless conection from my computer to the network card
3) Plugged my xbox into the network card using the crossover cable
4) Configured Ethereal to sniff activity from the network card connected to my xbox
5) Was dissapointed, yet not surprised, to see the encrypted data that came up on my screen.
The only thing that wasnt encrypted was the M-Search packet that is sent at the begining. Sorry I don't have any examples to give because the saved packets file, as well as the xbox, is at my other house and is not readily available to me.
Perhaps someone here who has done this sort of work can fill me in on the encryption that the xbox uses to sent packets. It's amazing what I can accomplish as far as taking apart the protocol (I've done this with several protocols, including AIM oscar and tictoc, Kazaa, Tetrinet, IRC, MSN Messenger, etc) but as for encryption, well, that just stumps me...
Can anybody here bring me up to date?
Thanks
Disclaimerish thing:
I'm not saying that I endorse illegal hacking. In fact you might check out my site
http://freehost07.websamba.com/greyhats/ to view some of my legal hacking work, which I myself have worked with MS to patch.