You can either use an ethernet cable to plug the 360 into the router, or you can shell out $100 and get a wireless receiver that plugs into the back of the xbox. Either option will get you into XBL.
In defense of the sales people, Christmas is the absolute worst time to work retail. Everyone has to work longer hours, the customers are far more difficult, no one seems to comprehend that popular items will be sold out (someone swore at my wife when told they were sold out of something the day before Christmas). I am sure you were the umpteenth person to ask for the Elite at both stores since the websites are often wrong (as they are typically not updated in real time) and it is often store policy to keep a display version of items since some people will backorder them. I totally get that you are frustrated, but so are the salespeople, trust me, Christmas sucks!
Only real image issue I have on a SDTV is that all the text is incredibly small. I think the Elite is worth it for the HD and the cable (the HDMI cable alone makes it worth it since, let's face it, you'll be getting an HDTV sometime). The whole RROD thing is getting better as they get their manufacturing cleaned up. The Falcon is really just about running cooler, doesn't really seem to affect gameplay.
There is a major price difference between the 360 and a high end PC (like $1500 at a minimum). I have a decent PC and it still can't run the majority of games, so, yeah, I'll spend the $400 on a 360 instead of dropping $3k on a new PC.
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