This discussion is just going to go nowhere.
You've got some people (largely outside of the US) that are fine with more socialist policies and having governments have a lot of leeway in regulating businesses. They think loser hackers should be able to mod their consoles, including mod them to steal games, and the company should be forced to be allowed to let people with these hacked consoles access THEIR network.
Then you have others that prefer free markets and letting businesses set up their own models and letting customers decide their fates buy either supporting or not supporting the company and their policies. With some limited amount of regulation of course to keep companies from ripping consumers off.
The two sides aren't going to change their minds as it's a fundamental difference in beliefs about what the role of government in the market should be. Not to mention all the different laws in different countries which no one here is familiar with beyond some knowledge of the laws in their own country.
For the US, there's no problem with the type of EULA MS uses. Maybe their is in other countries. In that case MS needs to either adapt or just stop selling in those countries. The majority of 360 sales are in the US anyway. Plus then I wouldn't run into annoying foreigners with laggy across the globe connections on Live.