Thank you. I am not worried about that noise and will be primarily modding for the purpose of emulating SNES, Genesis, and Arcade mainly. Everything else is a bonus.
Honestly I think emulating on the xbox nowadays gets more credit than it deserves. It's decade old hardware after all.
It's mostly a "tradition" thing. For what it does, it's inefficient. You'd be better off building a PC with modern hardware.
Also, consider these retro titles are available as native wads (actually wrapped nintendo-developed emulator + rom) for the Wii:
http://en.wikipedia.org/wiki/List_of_Virtual_Console_games_for_Wii_(North_America)
Some people are tricked by the internet into buying an xbox to emulate Supermario64 at choppy framerates when they could play it on the Wii nearly perfectly with much less power consumption. That's what I mean by "tradition inertia" in the available information about the 1st-xbox scene.
I'd start with a Wii and explore all of its possibilities...especially GC, Wii and Virtual Console titles....only then consider to also invest in a xbox (with steeper learning curve and rarer internal PATA hdd).
Also consider "Arcade collection" or "Retro collection" kinda retail games available for GC/Wii/Ps2/Ps3...leave homebrew emulation as a last resort...