Verified answer

The three red rings of death is absolutely free to fix! Just call 1-800-4MY-XBOX and file the claim. They'll send you a box and packing supplies to ship the unit and repair it totally free of charge. I just went through this process about 2 weeks ago. It's pretty easy. Good luck.

You cannot upgrade your system. but if it breaks down microsoft will fix it for free, and give you another xbox , that most likely was repaired at another time.

you can get an elite for free. see how here:

http://iwantanxbox360elite.blogspot.com/