It involves modifying the firmware on the dvd drive. Search and I’m sure you’ll find the thread where we went into detail about it. I’ll say this… it is not as simple as just downloading a file and running it.
Once you get banned the console is banned for life. No matter who tries to use it that console will never again go on Live. Your live account is never banned for playing on modded consoles and you can simply move it to a non-banned console and be back on Live in minutes.