I've had one problem w/ my 360 ... not enough to give up on the 360. Hell, throughout the years I've had various problems with my hardware (ASUS board, macbook, ps2, memory, etc) ... if I went through life not buying an item after I get one failure, I doubt I'd own any gaming system or computer at this point.
With electronics a user can expect an occasional glitch. I expect it, crap happens. Apples and MS's customer service was great, so it made the experience bearable. I've had a few instances of some piss poor customer service, and that leaves more of a lasting impression then the 24 hours it took to get a new laptop battery, or the less then two weeks I was without a 360.