Here's the one thing I don't get.
Microsoft keeps it real simple. There are two types of hacks on Xbox 360--Ixtreme DVD firmware and JTAG. Ixtreme only allows piracy but not cheating. JTAG allows Piracy and cheating. Microsoft bans JTAG consoles within hours or minutes of them attempting to go online. Ixtreme they do in waves once a year, typically.
In any event, no matter which method you do, Microsoft just bans, where you violated their network TOS. They say there is no recourse. Have a nice day. They don't seem to whine or complain about it. They even originally crippled some of the features (e.g. couldn't install games on HDD on banned consoles, then they decided to losen up). The only time I've seen them ban gamertags was if they were doing some weird exploits or playing games before the game release date. Otherwise, they only ban the console. I've never seen Microsoft get all sue happy about hackers etc. Quite frankly, their methods seem quite "adult". I even remember their positive attitude for the guy who cracked WP7.
Meanwhile, Sony just seems to be crying like a little immature child--they go suing after some broke kid, Geohot, etc. They send e-mail threats. They send online threats--more TOS, etc. The banhammer hasn't really hit yet--although everyone says it's coming. They whine, they complain. Grow the *** up already! If you're pissed, just follow Microsoft's example.
Microsoft just seems to have more class.