Thanks for the response, that's more or less what I thought.
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Please note that installing a mod chip voids your warranty and in itself is illegal in US (the DMCA makes it illegal to circumvent copy protection, regardless of the legality of the reason for your circumvention) and most other territories.
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I'm in Canada so the DCMA doesn't apply to us, nor should it. People should be entitled to backup games they legally purchased, if the Xbox is going to risk scratching and ruining the disk.