if i was betting, i would have totally bet that the MU was corrupt ... i'm glad we weren't betting.
the MU might still be corrupt, but i dont have the 2nd 360 to fully test with. at least using Xplorer360, it shows the 2 partitions and alot of data on the MU ... which makes me think its fine.
attacking from the other direction, i tried 2 clean MU units in both slots ... and neither were recognized. so my 2nd 360, which was actually provided by MS for being an MCE MVP (at the time), seems to work except for the MU reader. i don't think that box is even included under the extended 3 year warranty plan ... not to mention this isnt the RROD. anyway, i wrote enough MCE articles that ran on the 360, and even some XNA code, that i think MS got their moneys worth out of it. but with the 360s lame DRM scheme, requiring sneakernetting an MU between consoles, its now pretty much a boat anchor for me as a consumer.
so after 2 (and 1.5) years of no problems, within a months timeframe i have 1 dead 360 and 1 partially broken 360. believe it or not ... i was actually considering upgrading to an elite. based on the costomer service i've gotten so far ... that is now out of the question. out of principal.