MS points are used to download arcade, original xbox and DLC.
Demos are free, but i think you need a gold membership to download them
You don't really need an air cooler, just keep your xbox in a ventilated place and don't leave it on for days. Also i think air coolers take power from other parts of the xbox which makes it slower?
You can buy MS points on your xbox or from xbox.com. Just go to the marketplace and search for the game you want to download stuff for.
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