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I suggest you read up on what it actually means to get banned, you can no longer use some media functionality or transfer files between xboxes if they've been on a banned one, or copy games to the hard disk. These are, undenyably, changes related to being banned.
And if Xbox Live and the 360 are advertised as being part of the same service, in the same advert, as the UK adverts suggest? Yes, that creates an expectation of service. This is a mistake on Microsoft UK's part with the current advert run.
Also... how would it not be affecting the games industry? You've just created a situation in where many people will no longer purchase any legitimate xbox games. More, many of them are likely to never purchase legitimate games again, and you've cut them off from the online store and so on so they can't purchase those games if they wanted to.
Sony have been far more willing in general to work with the homebrew community (until the slim), and don't use region locking - these are major factors in the lack of easy PS3 hacks. The talented people who have PS3's are doing homebrew, not brewing hacks!
That is the correct model in future consoles, and Microsoft's policy against hardware and not accounts is precisely the wrong one.
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