A banned 360?
I think they will be put on a disc after a couple of months like they did with the Fallout 3 ones but why not just create a new gamer profile with acces to xbox live?
After that, just go down to the local store and buy xbox live points there, go home, use the redeem code and voila, now you have points.
iirc, If someone got banned from xBL due to microsoft detecting that they modified their console to play pirated games, people have then turned around and tried to unload the used units on Craigslist, etc. Someone buys it, not realizing that they then will not be able to hook up to live. I don't think he can create a new account either, doesn't work that way.