In the \linux\isolinux folder of xboxhdm, edit option 3 of isolinux.cfg with an editor like notepad and remove vga=0x317 and save the file. Run make-iso-win.bat again to recreate the iso and burn it.
CODE
label 3
kernel /isolinux/lockImage
append initrd=initrd.gz load_ramdisk=1 prompt_ramdisk=0 ramdisk_size=24000 rw root=/dev/ram pci=biosirq
See if that helps with the display.