This is no longer an issue for me. I am assigning my joysticks to be the left analog sticks and will be launching the 360 games via my game loader on the PC. Here is how I plan to do it/work so far:
I'm no master at circuits but here are my steps:
*Install FTPDll w/Dashlaunch 3.11 to get FTP running in the background 24/7 (done)
*Have my launcher hit the FTP with exec commands for each game (done)
*Turn off my computers HDMI signal when a 360 game is launched (done)
**At this point the Kinivo 301BN will switch audio/video to the 360. The 360 will be set as the default input and the PC will only be switched when it's outputting video. Therefore by turning off the video signal it will revert to the 360.
*Use an Arduino to drive a relay I have set up for switching my controls from the ipac to the 360 controllers (this is wired already but haven't coded the Arduino yet). The Arduino will also be responsible for checking if the 360 is on by reading the voltage from the power LED. If it is off, it will send a power signal to the system and I will have my launcher wait a little longer before firing off the exec.
To revert control to the PC, I will just listen for my CP's exit key. This will turn the computer back on and I can send a signal to the Arduino to turn off the coil voltage and revert my CP back to the ipac. The aforementioned "exit" key will always be attached to the ipac.
Pretty excited about this build because the end-user will have no idea it's a real console since everything should be seamless and automatic!

. Dashlaunch allows you to block mini blades from loading up so I will (almost) always be able to keep track of what game is being played. The only issue is when you're in an XBLA game and you hit return to arcade...not sure what to do with that one.