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You're fucked. My 360 started giving me the "Unreadable Disc" message a week before Gears of War 2 came out. Then, I read discs after A LOT of prodding. Finally, it wouldn't read discs at all. As a final kick in the balls, the thing read Tomb Raider Underworld only to decide, mid-game, to grind up the disc. If you're under warranty, send it in now! I'm just goint to buy a 60 gig Pro in January. Use the other one for Netflix and Arcade games.