I bought my used Xbox specifically with modding in mind, and my favorite "homebrew" app by far is Xbox Media Center (XBMC), which essentially turns your Xbox into an HTPC. XBMC has built-in support for Python scripts, which has yielded some interesting plugins, including John Maddox's new Flickr plugin. The Flickr plugin lets you view all of your Flickr photos on your TV, and the interface is gorgeous to boot. If you've been looking for an excuse to mod your Xbox, this might be the extra nudge you need.