I wasn't taking any chances on this thing. Bought a three-year service plan at Future Shop with it. Lo and behold in the first week it broke, but I had it sent in to MS for free (though it took them five weeks to return it). At least if it breaks again I have the service plan.
Well, if common sense wins the day, the bug in the March update conveniently fucked up a ton of 360s just days after their 3-month warranties expired. Because that simply reeks of all sorts of BBB-unfriendly practices, it means that Microsoft is going to more or less give way on the "implied warranty" argument for some time--if only to avoid a huge class action lawsuit just a few months into the console's lifecycle.
Somehow, all that makes me doubt that they'd turn you around at the door if you were willing to pay them even more to support the console. And if I were you, I'd get on the phone, haggle them to $45, and then pay it. Better than getting fucked in a year.
I'm still curious if the GRAW-argument of "the game is using the GPU at a capacity no other games did and it turns out that it's overheating and frying the mobos of some 360s even though it's still completely within yield."
That's a completely possible scenario and would really be awful if they had to recall and redesign the console significantly to nip it in the bud--if the Famicom's success is any indication, recalling and fixing a problem early is way better than letting it linger.
Blockbuster is offering $350 for tradins on the premium pack where I live, so you might just be better off getting rid of it and getting a new one (assuming they've got some of the manufacturing problems worked out).