In the Build v1.1.8\Extras Disc\Documents folder their is a txt file that says:
You can run the "Xbox Softmodding Tool Extras Disc.iso" from the Xbox HDD.
What happens if I run the virtual image and wish to restore xbox to factory using that image. Will it corrupt the drive as the image is being read off the same drive? Or being a virtual image it is stored in a temporary location and once the xbox is restored it is deleted and won't interfere when restoring.