Lets get serious here. I spent close to $1000 on my xbox with the wireless keyboard, wireless controllers new hard drive, cables, usb adpater, fan, mod chip, switch to turn mod on and off, replacement CD Rom drive (so it can actually read a CDR) etc etc
All to get a Computer that sort of runs linux but very very slow cause I still havent worked out how to upgrade my ram and the case looks like it has been in a war with holes cut all over it.
For $1000 I can buy a damm good computer. There is maybe 1000 people in total who are into making hardware modifications to there xbox to run linux (or whatever), the rest just want to pirate games and cheat on xbox live (the cheat on xbox live will never happen, well not for long before they patch it anyway)
so for under $200 yes you can get a subsidized xbox to run linux but you need some dam good technical knowledge and throw lots of money at it to actually make it usable so again only about 1000 but even if it was 10,000 sold for this purpose they will not lose a lot of money the rest will be sold to play games and to play they will need to go on xbox live.
M$ have smart people and they would have realized up front you can not make a unhackable standalone computer, Every other console on the market has been hacked in one way or another so it was just a matter of time.