There was a contest with an anonymous donor who promised $100.000 to anyone who could get Linux running on an X-Box.
This was indeed accomplished late last year, by modding the machine (adding/replacing a chip inside) to by-pass security measures.
At that point the contest was extended to offer an additional $100.000 for the first person/group to get linux running on an un-modified x-box machine.
IIRC this has also been accomplished.
Turns out the CEO/director/owner (or something) of Lindows was the anonymous sponsor.
NB: the secret to the security measures was found via a bug in a savegame.
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"Do not kill. Do not rape. Do not steal. These are principles which every man of every faith can embrace. "
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