I have a friend whom so of you know on here and xbla, naming no names, who has extensive experience in hacking 360's, basically you hack the disc drive. Apparently these days It's a complete pain and lets be honest here, 100% of the hacked consoles that i'm personally aware of have been banned from xbox live or RROD'd either before hacking or since hacking. He now plays on an unmodded 360 as he plays on LIVE with us a lot and would rather be able to do that then be able to play any game he wants for free, but have to play it offline.
It seriously sounds like it's more hassle than it's worth.
Take it from someone who bought a launch Wii and soldered an original Wiikey to the drive, now i can't play originals OR copies released after New Super Mario Bros as my chip is no longer supported for updates by the manufacturer and i'm not opening the thing up and putting a new one in.
Though TBH the Wii's always been a gamecube to me anyway, and i have a crap ton of original cube games.
Take it from me, unless you can be arsed to keep updating/unbricking/unbanning consoles, it ain't worth the time and effort just to save a few quid (or dollars).
Now the PSP and DS however, that's a different story altogether.....
Sorry if i have bad grammar and spelling, blame touchscreen phones...