For GH2, at least on the PS2 (I'm pretty sure it's no different for the 360.) you go to the main menu screen and just hit each of the buttons in sequential order. No chords, no strumming, just hit the fret buttons once, then the next, then the next, until the code is finished. You should get a confirmation on screen that you entered the code correctly.
In GH3, it's a different story, that actually has a cheat code input interface, and actually does require strumming, with chords. Since you've got GH2 you won't have to worry about this. Just hit each button that it tells you to.
One other thing: Make sure you don't have the guitar tilted when you are entering the codes. For some reason the tilt sensor in the guitar can mess up the code entry.
Edit: By main menu screen, since this may be confused with the "Press any button to start" screen, it's the screen that says "Career", "Quick Play", "Multiplayer", etc..
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