So, We went and bought a 360 elite at Target the other day. We set it up, and it crashed in less than half an hour, and started displaying the "Red Ring of Death", three red lights general hardware failure. So, naturally, we were upset. We tried a couple things, and it just did not work. So we called the XBox Customer service line.
The lady I got was very polite, and her Indian accent was only barely noticeable. As per the normal system first she took my name and the consoles Serial number. Imagine our shock, outrage, and then magical joy when we discovered that this XBox, Sold to us as New, was already registered to SOMEONE ELSE.
So, we looked closely at the box, and behold, the seal sticker shows signs of having been pealed back and replaced. Later, I realized that the console should also have been wrapped in the box. It was not. Someone (I suspect a target employee, like a night stocker) had broken their 360 elite, and had brought it back to the store, and swapped it with a new unit, and then resealed the broken one in a new box, and stuck it on the shelf.
Needless to say, we got a replacement from target the next day.
But seriously, nothing like having it be broken before you even get it home...