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[...ReLLiK]

All you need is a couple hubs or switches. I guess that your router probably only allows 4 connections? Eternet Hubs or Ethernet Switches usually come in different port varieties usually like 4/8/16/24 port.... Here is a link for an $85 16-port switch that will allow you to connect all 16 xboxes up at once. Buy two and voila!
http://www.dlink.com/products/?pid=71

You can use this setup to do system link... and you can not mix system link with xbox live. you have to either do ALL system link or ALL xbox live! (that would require 32 xbox live accounts...lol not to mention your DSL and router would not provide the bandwidth for all 32 xboxes at the same time... you would need multiple dsl connections!)