Not sure if this helps or not, but I figured I would at least contribute here. I have had my xbox since November 2003. It was brand new at the time and I had a xbox-scene member mod it and send it to me. I was never worried about live, so I never used it. Then Halo 2 came out.

I figured I would give it a shot. So I borrowed a friends game and 2 month trial. Signed up for live. Everything is working fine for a week now. I know you guys have a ton of theories, so maybe my info will help. Then again, maybe not. Who knows. I'll be happy to answer any other questions if you have any...
Do you think MS reads these forums?
I wonder if they somehow find who on here has a modded xbox and ban them from Live. That would be easy. Don't you think?
QUOTE(voidunknown @ Apr 6 2005, 12:41 AM)
Do you think MS reads these forums?
QUOTE(Lord Magnus @ Apr 6 2005, 09:29 AM)
HO HO HO !!! Got ya!! You'll be banned in 7 daaaaaays!!
QUOTE(sidewinder33 @ Apr 8 2005, 04:12 PM)
hahaha now the guy with your name for his gamertag is gonna get booted. as long as you dont go on with your chip on you should be just fine bud enjoy live.
QUOTE(rwarrin @ Apr 9 2005, 02:49 AM)
Well I got banned and never went on with the chip on. I did upgrade the HD and they can tell even though I copied all the files from the original drive to the new drive, some how they know the hardware has been changed. Oh well the mod works great and I will figure out how to get back on.