I always thought it was some kind of Hippie-esc univeral variable thing.
In pc talk computers are referred to as "boxes", i.e win-box, linux-box, be-box. I thought the X was a refference to the mathematic variable for anything, as if to say there is no need for your old consoles when you have the "X" box (as in everything), though I'm sure Mountain Dew, Extreme Game, Gung ho marketing has alot to do with the X...