Had something similar to me happen the second time my X360 died. My warranty was expired by almost two weeks. (this was before M$ extended the warrenty out to a year and admitted that there were issues with the system) I unfortunatly had to pay for the repair, but after speaking to a supervisor they were able to give me the repair at half price.

Even better, when M$ admitted that the systems were faulty and extended the warranties, I got re-embursed by M$ for the full cost of the repair. Guess that was karma looking out for me since I had to get minerepleced twice.

UNO

There actually is a solution, but M$ just isn't doing it. The DL content is keyed to your Gamertag and console serial number. When my first X360 was replaced by M$, all the content I had already downloaded was re-keyed to my new X360 by M$ enabling me to play it on my new console on or offline.

Here's the solution but M$ isn't doing this. If you actually register your new X360 Elite through M$, they can verify that you have infact purchased a new unit, and re-key your downloaded content to the unit. Then the content would only be accessible offline to the X360 that is registered.

M$ is not doing this. I spoke in great length this morning with customer service, and not just a regular rep, but a supervisor. They are aware that content can be re-keyed but are not doing it.  They are also not refunding points for anything that you have already purchased. Nor is there any fix for this right now or in the foreseeable future. I got the standard company line "Sir, i understand your frustration but there is nothing we can do right now. We have noticed a large increase in calls because of this very problem. The only thing I can do is forward this information and hopefully M$ will do something about it in the future."