Consoles Online = Corporate Control (Abuse)
It was only a matter of time before M$ got pissy about mods.
Sony did it in the past and Nintendo as well.
Right now though you can hack a Wii and use ROMs to make your own Virtual Console and since Nintendo's network is worthless for multiplayer you would be missing nothing if they made such a move.
My Wii isn't even connected to the network because I have no use for cryptic friend's codes for every damn game or overpriced ROMs.
XBLive is a great environment and truly the best of all the consoles as far as community, content, GUI, etc. You can play 360 without it but the experience is so drab that M$ is hoping they force you to be legit by denying access.
I think they are being smart as dev costs for games are higher than they've ever been (8 figures at times) and the ratio of people using mods for "true backup" versus stealing from torrents or friends copies is probably evidence the mods are for pirates not the "scratch conscious" frugal worry warts who want a backup for little Johnie.
Sony's current online is total crap and time will only tell is Home is an improvement OR a nightmare in poorly executed virtual reality style GUI marketing hype. If Sony can use online connectivity to prevent mods, they will.
I wouldn't be surprised if all three (M, S & N) block mods altogether and if all future generation of consoles will face this bleak reality.
If they can exploit and abuse this newfound power
in the console arena -- they most certainly will.
Be honest folks, we like to "mod" so we can get stuff
free or save money on upgrades here and there.
No corporation likes that one bit or byte.