1UP.com has an eye-opening article about the Xbox-woes of one man, Justin Lowe, who has had eleven 360s die on him:
Justin has not had a working system for longer than a month or two. The list of problems is almost comically large: three red lights of death, two with disc read errors, two dead on arrival, several with random audio and video-related issues and one that actually exploded.
I wouldn't go so far as to say that Justin's experience is typical, but it is indicative of the greater problem Microsoft is facing with these broken consoles: they just don't know how to fix them. And while Microsoft says that we should judge them by how well they treat us when our consoles break, I don't think that replacing dead 360s with failing 360s is a commendable fix.