I am on my 4th console. I bought it on Apr 1, 2006, and the manufacture date was sometime in Feb, so it was not a launch unit. In May a couple times it locked up playing burnout, but I didnt think much of it. A month later or so I tried playing Perfect Dark, which I had bought but not played yet. It would lock up 5 mins from starting a game every time. Then the red lights of doom.
I called MS, they UPS'ed me a box right away with a return label. I sent it back, and about 10 days later, a refurb launch unit showed up, manufactured on 11/14/2005. This one only worked fine until one day in August, when it went from locking up for the first time, to red-lights in a couple hours. I called, got another box sent to me, and send my console back again. I got #3 in a week or so.
The third one started locking up in Dec, but I was going out of town for almost a month, so I didnt send it right away, but instead was greeted with red-lights when I got back home. I sent it away again, and now I have console 4, which has been fine since. I do notice that this newest one is a little quieter (thank god), than the other ones.
So yes, I have experience that 360's break, and not just launch units. My experience is not enough to make a general statement about reliability. All consoles, or electronics in general, have failures. My roommate had a gamecube die, but he did leave it paused on a game for days at a time.
I did talk to a service rep about ventilation. I have the console vertical, with 4 in on either side and the top, with the front and back open. They said that is fine.
Here is my advice.
If your console has any problems at all, (freezing, slowdown, flickering) stress it. Try different games (perfect dark always broke mine), put in Gears and play online, play an HD-DVD if you have the drive. If you console is going to break eventually, it is better to do it all at once, then replace it, rather than slowly watch it get worse and have to baby it. This is provided you are still within the warranty period.
If you don't want it to die, then dont be like me and just ventilate it "good enough." Put it way out in the open if you want to be safe. It does make a lot of heat, so the more airflow around it, the better.
I hear that the majority of people who buy one now really dont have problems. They have probably improved quality over time, and some parts have been changed (DVD drive), for better reliability and performance.
When you call MS, sound like you know what you are talking about, and do some testing first. If it locks up, try different things, like sitting in the dashboard, playing arcade and retail games, watching videos, ect, to find out when it locks up. If you have the red lights, try unplugging the power and resetting, and removing the hard drive. Then when you get a person on the phone, tell them everything you have tried, and be patient. I never had to sit on the phone for more than 10 minutes before they decided to send me a box.
Last time I talked to them, they said I would have to pay to ship it to them with their new policy. I said that last time they sent me a box, and they caved and sent me a box with paid shipping. If you are poor, or just cheap
, then ask if they could please send you a box. I dont mean be an ass, but if you say, "I am poor and didnt do anything to break it, I dont really want to pay to ship this thing to you," they might send you a box.
I am very happy with my 360, and if you only want one of the current gen consoles (360, PS3, Wii), 360 is probably the way to go for now. Plenty of decent, and now cheap games, and plenty more coming out soon.
I hope some of this helps.
Edit* Holy crap that is long, I hope everyone likes my novel.*
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