Shouldn't, no.. I'm using 4983.06 on Xenium with a 1.4 Xbox no problem. When I installed Slayer and told it to rebuild to Large HD, I had to install Evox using the Slayer CD after. It tells you that rebuilding will include EVOX and APPS, but for some reason the MS Dashboard comes up instead.
Sounds like a bug, but reinstalling EVOX using INST/UPG seems to have fixed that. I have XBMC and thus am happy.

But I'm using the 256K on Bank 0, I didn't resize. No problems thusfar.
--D