burning the 360 game is easy, the hard bit has allready been done, that is the ripping. to play the game you have to connect your 360 drive to a sata motherboard and then update the firmware, its very easy, but if you run into a fault you may brick your drive, this isnt the end of the world as there are a few people online repairing them from �15.00.
I cannot see how xbox live service can brick it, because that would mean flashing the drive externally, i dont think there is a way to directly communicate with the drives firmware through the 360's board.