Howard, what about all the different emulators for the Xbox? Sure, you have to install a modchip to use them, but if you can hack a gamepad a modchip should be no problem. MAME-X would be pretty sweet with real arcade controls.
Yes they would except for the following problems.
#1 As of now none of the emulators on the box allow you to redefine your keys. Not a big deal for all games, but then again games that ust use a stick and a button or two could be played just as well on a gamepad (although definately not as fun.)
#2 The modchips cause the x-box live! service not to work, and basically any other software upgrade based on the live network. If your aren't into the network gameplay, you should also be aware of the fact that additional levels and add-on's are going to be available via the live network, and the only way to recieve them is to have an un-modded xbox.
In other words a modded xbox won't be used for normal gameplay, it would have to be pretty much a emulator only thing. That would be ok if the box allowed spinner and trackball inputs, but since it doesn't (at least not yet) then it's pretty much not worth it.
Now when the emulators improve then it will be, but as of right now they really aren't up to the task.