In case nobody knew yet...
Confirmed: Microsoft WILL pay for 360 Repairs
It's now Official - Microsoft will indeed pay for repairs on systems manufactured before January 2006 and provide refunds to those who have already paid to repair such systems.
Real good news for 360 owners... nice to see Microsoft dealing with their console problems the way it should be done.
"As part of our standard and ongoing process of analyzing repair data, we recently noticed a higher than usual number of units coming in for repair. Upon further investigation, it was further discovered that the bulk of the units were isolated to a group that was part of the initial manufacturing run of the console. Returns for repair are coming in for a variety reasons and it's a higher rate than we are satisfied with. We've made the decision to comp repairs for consoles manufactured before January 1, 2006, and provide refunds to the small group of customers who have already paid for repairs."