Wrong answer. My XBOX has never seen a game since I've owned it. Period. Legal or otherwise. I modded it to use with XBMC as a cheap media player.
Pirated movies. Whatever.

I have several hundred movies on my media server. Not a single one is pirated. They are all ripped from my original and safely kept DVDs. My originals are safe from the destruction my kids heap upon media, and movies can be accessed anywhere in the house there's a network connection. I don't use a modded console for that, but I considered it.
Not everyone is a pirate... 
+1
+2, i have 3 modded original Xboxes that just run XMBC, to play my legally owned and ripped music and movies, anywhere in my house. its much cheaper to buy a 20$ xbox (or three) and do a softmod, then to buy a HTPC or any of the set top boxes floating around,
but,
i agree the heart of the matter is whether we as product OWNERS can do whatever we want to our "purchased products". we are modders and tinkerers, we are curious about how things work and how they can be made better, or used more to our personal needs.
the double standard of "certain people are allowed to mod and the rest not. or heads of industry can pirate music and movies and not get in trouble the rest of us can't", needs to stop. arrest people for pirating, not for making things that can be used for pirating.... we didn't kill all ship builders to end piracy on the 7 seas, we went after pirates, and made the world a different place, where pirates were not effective or needed...
i've ranted enough for today

that's just my 2 cents and it wont change anyones ideas or opinions but i thought we needed another vote for modded non-pirate xboxes