The spring update is around end of May and yeah, I do hope that the update will solve the black level issues via the VGA. I connected my expect to my Philips CRT monitor via VGA (sometimes I play games in my room), the colour is a little washed out compared to connecting it via component video to my Bravia. Most of my friends face the same problem. That's a big letdown I guess. They should allow us to tweak the contrast and black levels via the dashboard. Hope the spring update will address this issue and hopefully with added backward compatible titles. Really sad that most of my old XBOX titles can't be played on my XBOX 360....... Sigh ....... and they're originals........

Microsoft has sorta fixed the VGA problem, I'm using the Expanded settings and it works well with my Philips 19' CRT monitor, the colours come alive and black levels are impressive. Besides this, even the compatibility list has been updated as well, I can play DOA 2 Ultimate on my XBOX 360 in widescreen in 720p. Yay.

Technically won't affect modded consoles but dunno whether can play online or not aje because from what I know, MS can do checks whether your disc is original or not at random via XBOX Live so that's your luck, if kena caught, you'll be kicked out from XBOX Live. If you're into online games, it's best to get ori games to be on the safe side.