Your problem is a dying (or dirty) laser lens. One of my friends had this happen to him twice now. Unmodded unit.
Read more here:
http://www.llamma.com/xbox/Repairs/t...stallation.htm
Mine is heat related. Fan may also be dying (cheap bearings). The unit is also sensitive to dust, and hates being put on the carpet.
And if heat is such a problem, why on earth did they cram it into a box with zero flow? A "do not put on carpet" warning label would also have been appropriate, at least I think so.
Microsoft made these things from leftover parts, it seems.
I opened it up this afternoon, blew it out, and left it open while I played it for a few minutes. By the time it was fixed, I was no longer in the mood to truly sit back and play it.