certain severs allow (MSP spoof)
also its possible to get XBL if you purchase a server
Custom Dashboards
Unassigned Code
Play games on an external hard drive
Unlock DLC, Arcade Games, GOD
Download and play any game with no disk or DVD-rom
Play any region game
Developing exploits
Running Linux
Emulators
FTP Capabilities
Play online with other JTAG/RGH users using XLink-Kai
System Link to a retail for Menus, lobbies, hacks etc

Unlock GOD, Arcade or DLC for a retail xbox
Go on Xbox Live (unless you purchase time for a server)
Host Prestige/Menu Lobbies online (unless your JTAG/RGH is online)
Update the Dash without having the same kernel if you don't reflash your NAND (You will brick your console)
Of course there is more but these are just he basic things to help people if they have questions about buying, or even want to experiment.

Flashing - this means modifying or altering your Xbox's memory so that it can read backed up copies of games (another way of saying 'Pirated Games'. it usually involves either changing the BIOS (operating System) of the Xbox or installing a Chip to get around the Security issue.

Jtag - A Jtag is a hack used to 'fully unlock' an Xbox's capabilities. It allows such things as 'Wall Hacks' AimBots and many other wonderful features.
RGH - This is an Abbreviation of 'Reset Gltich Hack'. It generally involves sending a small electrical pulse to the processor in order to Change the way code is run from the motherboard. In other words, it lets you format your xbox and run Code that the Xbox wasn't originally designed for, such as Linux. i'm not totally sure, but i think Jtag tools need to be used in this aswell.

I think this is about right but someone else may be able to offer a better answer for you. I should mention that any of these things are HIGHLY illegal, and will result on bans and probably fines aswell.
Hope i helped and if you're gonna be hacking' do it carefully