This is literally the coolest thing I've seen in a while. Though I've never had a problem with it, the Xbox 360 is well known for overheating, which can lead to permanent damage of the motherboard and/or other internal components, which leads to what's known as an RROD, or "Red Rings of Death", in which the four quad-circles around the power button, used to indicate how many players are connected, all turn red. "Rings" in the plural because it's supposedly quite common. We've had our 360 for almost a year now and no red ring yet *knocks on wood* but we keep it in a fairly cool area.
For those in hotter climates or who are really worried about the Xbox 360 overheating, and you don't have a warranty or you don't care about the one you've got, premium Taiwanese computer case maker Lian Li has a solution: Change the chassis, or external body. To do so requires a moderate to high level of experience in working with electronic devices including circuit boards and a fair knowledge of how static electricity works (to avoid it from destroying your motherboard), but if you don't have the knowledge, you might know somebody who does. (I'll do it, but I won't guarantee it'll work, but only because I can't afford to replace a 360.)
In short, you take apart your Xbox 360. The hard drive is in a special separate casing, but other than that, an Xbox 360, like a standard Xbox, is nothing more than a PC in a special case set up to not run Windows (or Linux) or any PC software, and only run special Xbox software. The hardware is mostly standard stuff, and once you've got it all out on the table, it's mostly indistinguishable from the guts of any PC. And moving it to another case shouldn't hurt it in the least, if you do it right. It doesn't "know" it's been gutted and moved.
The only problem I can see, is that the case is ugly as sin. But from what I understand, you don't buy a Lian Li case because it's pretty (none of them are, that I know of). You buy one for the high build quality and airflow/heat management, which goes back to why they made a specific Xbox 360 case in the first place. In addition to better air/heat management than the standard 360 case, this case also contains the plugins for water cooling, so you can basically have a 360 with a radiator. We don't call it a radiator in the geek world, since a computer isn't a car, but both devices serve the same function. You've got an external reservoir outside the computer which pumps the water through. The water goes through tubes, which connect to copper plates which can be attached to the tops of the CPU and graphics processor and other hot areas. The flowing water over the other side of the copper plate quickly moves the heat away from the chip, allowing it to perform more stressful tasks without risk of overheating.
Again I should note that Microsoft does not approve of taking apart the Xbox 360 for any reason and doing so will void your warranty, if you have one. Lian Li warrants their case to be free of manufacturing defects, but this warranty doesn't in any way extend to the Xbox 360 hardware you put in it.
There's also no way that this is illegal. Usually when you hear about modding a game console, it entails enabling the owner to play copied or downloaded games. The only way to do that on an Xbox 360 is to change the firmware on the DVD-ROM drive, but that only allows you to play burned games. This process doesn't involve that at all, but it does make it easier as you have quicker and easier access to the internals of the Xbox 360, if ever you decide to take that route. Also, if ever they come up with a way to modify the 360 involving sautering the motherboard, this will make it much easier, as, again, access is quicker, and the power supply and DVD-ROM drive are kept away from the motherboard. But simply moving it from case to case in no way constitutes an illegal act.
Lastly, this doesn't give you the ability to change components out. Surely you can try, but I've never heard of a 360 being upgraded. It's an all-or-nothing deal - you can't add more RAM or slap a quad-core processor on it. Also, the hard drives are modified in such a way that you can't just replace it with another 2.5" SATA laptop hard drive. If you want a bigger one (e.g. you have a 20GB HDD and you want the 120 or bigger) you must buy the one for the Xbox 360, take it apart, and put it in. Not 100% sure, but I'd bet money you couldn't use any old hard drive. I've never heard of anyone with a 250 or 300GB hard drive, which I think is how big those little drives get nowadays (though for all I know they may have hit 500GB by now). It also doesn't mean you can add a 1.5TB internal drive and get to use that. It's still bound by the software-imposed restrictions it came with.
There's one thing about this whole process that rubs me the wrong way. I'm led to believe that Lian Li dropped the ball on this in a big way, but I'd like to give them the benefit of the doubt and assume that whoever wrote up the guide forgot about the DVD-ROM drive face. See, when you buy a PC DVD-ROM drive or burner, it usually comes with a black bevel, or "face", and this matches most custom or store-bought cases. Some include a white or light grey face you can swap out very simply, and this of course changes the color of the drive. The Xbox 360 DVD-ROM drive has no bevel, but rather a custom protruding tray cover and oversized eject button. For this case mod to be fully successful, they'd better include a proper black bevel.
Otherwise it's going to be ugly as sin, with an open gap around the DVD-ROM drive. They do specifically tell you to take the custom tray cover and eject button off, so there must be a bevel included. If not you could probably get one on eBay, but this would require knowing exactly what drive you have (found on the sticker on the top). The other gripe I have is they don't tell you how to hook up the power switch. Will you be able to see a RROD for what it is with this case?
If they have both of those issues taken care of, this is cool as hell. If they've forgotten both of those points (as opposed to just forgetting to mention/go into detail) they've failed in a huge way. But somehow I think not.