I am interested in getting into the Xbox hacking scene and would like
to know what my options are.

I have 2 areas of concern:
 (1) Obtaining an Xbox with a mod chip
 (2) Using the Xbox Live service

I will expand on each of these.

Obtaining an Xbox with a mod chip:
 - What are the best Xbox mod chips out there right now? Are any new
ones scheduled to come out soon? What do they cost? Where do I buy
them?
 - What are the most significant/promising features of those mod
chips?
 - What sacrifices/risks come with those features?
 - I am not interested in soldering to install the mod chip, so I
either plan to get a no-solder chip or buy a new Xbox with the mod
chip preinstalled.
 - I am moderately interested in replacing the standard hard drive
with a larger hard drive. What are the risks/benefits/costs of this?


Using the Xbox Live service:
 - Recently, have modded Xbox owners been generally successful or
unsuccessful in using the Xbox Live service?
 - What features of the newer mod chips contribute to that success? Or
fail to?
 - What exactly does the Xbox Live mod detection system check for?
Would it detect a larger, replacement hard drive? Is there any way to
hide unsigned software or data that is stored on the hard drive?
 - How does the banning process work? If I have two Xbox consoles, one
that I use for hacking and the other I keep 'clean', could I still use
my Xbox Live gamertag on the clean Xbox after the mod detection system
discovered something on my other Xbox?
 - What is the status of alternative services to Xbox Live?


I have found good information and lots of links on the following
sites:
 - http://www.xbox-emulation.co.uk
 - http://www.xbox-scene.com
 - http://www.xboxhacker.net

(Don't misunderstand, I am not saying that I have scoured these sites
and could not find my answers there. These are just some good starting
places for research.)

I should mention that I got my current Xbox about a year ago and I
live in the
US. In general, price is not a major factor. I wouldn't want to pay
more than $450 for a premodded Xbox with a replacement harddrive.

I'm not in a huge rush for the answers. I just don't have the time to
dig through all the content and I wanted to try out Google Answers.

SECTION 1 : The Chips

     As far as mod chips go, I think that the Xecuter series is the
best. That is just personal preference. I used the Xecuter2 Lite
http://www.justmodit.com , it is the only chip that I know of that
comes with a BIOS already installed which means you do not have to
flash it. The only complete solderless solution that I know of is the
Xodus Matrix http://www.easybuy2000.com Although the Xecuter team has
just released a pogo pin adapter that allows you to attach either the
Xecuter 2Lite or Xecuter 2Pro without solder. The Xodus chip Flash ROM
only has 256k of space versus the 1mb on the Xecuter 2Lite and Xecuter
2Pro. Currently there is really no BIOS that needs to be bigger than
256k. The only reason for the bigger size on the other chips is to
enable multi BIOS's. The Xecuter 2Lite is able to have 2 BIOSes and
the Xecuter 2Pro can have three. There are a few BIOSes out there but
most of them do the same, some are geared torward Linux on the Xbox
and some are geared torward Debugging for developing xbox software.
But the ones that are used primarily by regular joe blows are the team
Xecuter and EvolutionX BIOSes. Like I said before the only chip that
comes pre-flashed with software is the Xecuter 2Lite. If you want to
use any other BIOS you will have to scour the internet and newsgroups
because these are considered illegal.

SECTION 2 : XboX Live

     I noticed in the question that you have posted that you are
already aware of Xbox Live's  issues with a modded Xbox. If you
attempt to log into the Xbox live service and you have your mod chip
enabled. The Xbox Live service will boot you off, but not before it
can record the MAC Address of your xbox so the service will know when
you try to come back and prevent you from entering (even if you have
disabled or removed the chip) Heres the trick! With all of the chips
that I have listed above, they all have a mod chip disable switch that
will allow you to turn the chip off and on. I do want to mention that
if you do set your xbox up with the ability to turn the chip on and
off you will need to "Lock" your hard drive using a simple tool like
Config Magic from team assembly. This is a very simple step. This
stuff is not as confusing as it may seem. SO WHAT HAPPENS IF I FORGET
TO TURN MY MOD CHIP OFF BEFORE I GET ON XBOX LIVE OR IF I'VE ALREADY
BEEN BANNED? Well, there's hope. Team Assembly
http://www.team-assembly.com also makes a software tool that allows
you to change the MAC address of your xbox allowing you to go back to
using the Xbox live service normally.

SECTION 3 : Hard Drive Upgrade

     Most of the new BIOSes (Xecuter, EvoX, etc.) allow for HDD
swapping, and give you the ability to install a HDD up to 136GB. So
common sense will tell you that the biggest you'll be able to  find is
120GB since I've never seen a 136GB IDE drive. The benefit of a bigger
drive is the ability to backup and play xbox games, run Linux,
homebrew software and emulators, and Xbox Media Player (which gives
you the ability to play all kinds of media like MP3, divX etc. either
over your network or straight from the Xbox hard drive)

The absolute best resource for everything xbox, is
http:www.xbox-scene.com Go to the tutorials section and prepare to be
amazed. Good Luck -Shawn H