Modding the xbox is illegal, it is in the agreement you sign with xbox and also they won't let you mod.
This.
User-generated content for the consoles is something under frequent consideration by Bethesda and something they've said they'd love to see, but under current arrangements it looks unlikely for the foreseeable future. It's possible that games like Hunted and Spore might open doors for mods for some future game, but it certainly won't be Skyrim. Current problems include mods accidentally breaking the game (happens!), copyright content, restricted content (e.g. nudity), mods simply incompatible with each other, and whether Bethesda would have to be held responsible for the content we generate. All those would have to be ironed out before MS would even consider allowing mods on the xbox: it's a long way off.
Since this topic is already heading down the road of "illegal" discussion (or certainly EULA-breaking discussion), I'm going to lock this up for now.