Cheaters Never Prosper: Install NXE Early, Lose Xbox Live Until Release Date

Apparently a file containing the New Xbox Experience has hit the scuzzier corners of the internet, ones that I'm sure none of our upstanding readers ever visit. Still, if it happens to find its way onto your USB drive, you may want to think twice about installing it on your Xbox 360. Users installing the new interface before the November 19th release date will find that Xbox Live has broken up with their Xboxes, and their machines will unable to get online until the official release. At least there won't be a camera crew and a creepy guy with a soul patch following you around.
So while you'd be able to play with some features, Netflix streaming would be a no-go, as well as avatar creation, and you obviously wouldn't be able to play online with that Xbox until Microsoft officially launches the dashboard update.
Personally I'm looking to the NXE more than most of these firmware upgrades, perhaps even more than the PS3's in-game XMB. While I'm not particularly interested in the rather vanilla looking Avatars, my Xbox's disk drive is pretty loud, so I'll be glad to get a game or two at a time onto the (now woefully inadequate) hard drive and play in relative silence.
[Updated with corrections: Nov. 2]
NXE Leaked, Installation Disables Xbox Live Until November 19th [Xbox 360 Fanboy]








As the Netflix streaming is the only reason I'm allowing the "upgrade" (since I hate the new look and couldn't possibly care less about Avatars if I tried, and have almost no space on my HD to load games into), I have zero reason to try it out early...
Oh, and apparently you need a newer 360 that has HDMI or you can't get HD Netflix streaming without buying an adapter, so I may not even "upgrade" for the Netflix.
You were quite misinformed about this. The email that was sent out to the people that are actually in the testing program stated that it can in fact be installed on others Xbox, but that since they are not in the testing program and their serial numbers were not added to the test list, they simply will not be able to connect to XBL on that system.
The profile is NOT suspended in any way. You can take it to another system without the new dashboard installed and get on just fine. It was also stated that the people not in the testing program will be just fine when the 19th rolls around. You may want to do a bit more research next time...
In the meantime those not in the testing program can play with some of the new dashboard, though the avatar functionality can not be accessed until the live connection is active to the people not in the testing program but have the NXE installed. Also the “Optional Media Update” is not available since it too needs to be downloaded from XBL as well. So some of the media that you could play before may not work for now.
You would also do well to know that somebody that IS in the testing program with the the NXE installed on a hard drive or memory card could install it by simply putting the media (memory card / hard drive) into another system and install the NXE by simply telling it to update. (this being what happened to me. He accidentally told it to update.... only realizing what he did afterwords and started apologizing to me profusely for effectively kicking me off live for a couple weeks.) So no, there is no chance of being banned off live for having it installed prematurely.
@Shin Gallon
That is not correct. The only case that Netflix will not work correctly is if you are using HDMI with a monitor that does not support HDCP. Any other case words. You can use the analogue connectors of your choice. (Composite, s-video, component, or VGA adapter.) or HDMI, but only if the monitor that you have the HDMI cable hooked up to supports HDCP.
In case you do not know, HDCP is a DRM technology used to protect the content between the device providing the video and the display being used.
Also, you will not have the resolution reduced for using the analogue outputs.
@kouecat
Thanks for the update, I've updated the post to specify that the machine can't access Xbox Live, but the user isn't banned. I've also removed information about perma-bans, although several sources were reporting it as possible yesterday. As a matter of principle, if Microsoft was able to determine which users got the file via torrents or rapidshare (versus your "idiot friend" channel), I have no doubt punishments would be more severe. I grant that is unlikely.
@dawdle
There is really no way to tell who downloaded it from some place else and who got it legit. It is the exact same installer that is used by the people actually in the preview program. So there is no difference really.
Microsoft would not ban peoples boxes for simply having it installed. It is not in their best interest and the backlash would be really harsh. With all the people already in a lather about Spore and DRM in the industry right now. Besides, it does not harm Microsoft in the least, helping more then hurting. No bandwidth used by the pre-installers on live, plus they show it off to friends and get more people to buy in. They stand to loose nothing at all from people putting it on their 360s before the 19th.
@Koucat
So then the rumor I read that if you use component you're stuck with 480p rather than 720 or 1080 isn't true?
@Gallon
Correct. There is no reduction in resolution when streaming Netflix content and playing it back through any of the analogue outputs.