Another quick list.
1. Integrate the Zune Pass into Live (Gold and Silver). I wouldn't necessarily mind a Zune, but if I could get the Zune Pass service and use it with my 360, PC and a Zune? That's not a bad sell at all. Especially since they now have it that every month you get to keep 10 songs. For $15/month the idea of unlimited music at home and on the go PLUS getting music (MP3's, no less)? I can dig it. Add in streaming radio stations and you're set.
2. Communities/Groups like Steam has (Gold). This should be pretty obvious, actually. I don't know about the rest of you, but I can take one look at my friends list and instantly wonder "where do I know this person from?" I'm having to keep track of user names from multiple websites, plus real life, nevermind the people I add from just playing. Let me organize them, please!
3. Sub-accounts/Family accounts (Gold and Silver). Gametap has a fantastic subscription service (or at least did when I was on it). Set up an account, pay your $9/month, get all their games and content, etc. But the nice thing was you could have up to 5? 6? sub-accounts for your household, complete with parental and account controls. To apply this to Live - little Johnny can only play E-rated games, no voice-chat (send or receive), can't add friends without Dad's permission, can't play after 9 p.m. and can spend an "allowance" of up to 160 Live Points per month but can't buy full games or download demos. Teenager Ben can play up to T-rated games, has voice chat, can add friends, and can add Live points to his own account. Dad has full access, obviously, and could check online to see who's online, send them messages, etc ("Is your homework done yet?").
4. Coin-ops (Gold and Silver). Have a selection of quick downloading games that can be played as you want, when you want, online, for cheap. Price per play could range from $0.10 (8 pts) to $0.25 (20 pts) per play, and there's always the possibility for free play with ads ("Play Outrun for free this weekend! Brought to you by Jack in the Box!"), "day passes" (pay 400 points and play all day), etcetera. There are a lot of good, old-school games that would lend themselves to this. Its step up from a demo (not all demos enable online play, correct), previews the game for online play (helping promote Gold), and lets people just play as they like. Some folks may end up buying the game based off of this.
5. Better IM integration. I'd like to see Microsoft open up Live so you can see your friends using Yahoo!, AOL IM, etc.
6. Screenshots. This might be more of a system upgrade, but I'd love to be able to take screenshots of games then upload them to Facebook, Flickr, to a jump-drive, whatever. I actually would doubly love to see video capture, but that's a lot more work, and based on my experience using FRAPS can utterly kill performance if you're trying to do it real-time.
Just a few ideas. Tear'em to shreds.
I should mention, however, I put these up as I thought they'd be feasible improvements that wouldn't require any massive changes on Microsoft's part (like adding online play to Silver). Going more for "realistic" options.