And as with any chipping Microsoft will have nothing to do with your console once it's done, so unless your feeling lucky don't chip until your warranty expires and they ask £60 to fix anything (extortion)
you don't need to chip it at all. all you need to do is flash the dvd drive. i did it to mine you can't just copy the games on to a dvd you need a dvdrw with a special firmware and a dual layer burner and dual layer discs. with all the money you spend trying to copy the games you might aswell buy them. but there are many web sites that sell the "backup" games all you need to do is google "xtreme games" or "ixtreme games" and throw in 360 and xbox here and there and you'll find the sites. if you are a modder then do it your self but seeing as you asked the question i'm guessing you have no clue. so get some one else to do it, there are hundreds of people and sites doing a flashing service. it is easy enough to do but it is tricky enough that if you are not used to this sort of thing you'll do it wrong and again the money you spend buying the bits to do it, it will cost the same as some one else doing it. check ebay and google for something along the lines of 360 flashing service. and then i suggest you mod the thing as it will get hot with all the new games you'll be playing. screw the warrenty do the mods before it RROD's i bought one that was a red ringer and did it up and this is what i have done X clamp mod new thermal paste flashed drive new/better fans air flow mod removed the mesh (cut it out) where the fans are (allows about 15-20% more air through) my 360 doesn't get hot all the hot air gets sucked out, its nice and quiet and because its cooler i get better frame rates. and not done it yet but will soon be cutting the case and putting a pc case fan on the side so it is super cool.
Yea I have been seriously considering getting my Xbox 360 modded. I have already had to send it back once (Three red lights) and that is from playing bought games. So I am definately getting it modded now seeing as Microsoft can't make one that can keep cool anyway. Thanks i'll be looking into those mods you mentioned.