I think what he (and I) are after is the ability to just pop in a cd and boot (a modded) xbox up and have it participate in a distcc farm as a node, with a little configuration but zero install time.
This exists in the normal x86 world, as the knoppix livecd demonstrates.
If I get smart enough to build my own livecd, this would definately be something I would create, until then, I'll just ftp over my gentoox build that has distcc working. Only disadvantage to this is the transfer time to send 5gb worth of files to an xbox, as well as the hd space it would consume on said xbox (I'm mostly using other people's xboxes that they give to me to modify, so when I give them back their newly modded xboxes they need to be linux free).