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I am not sure, but I thought that's what i had wrong with my Xbox last month.  I bought it in September, so it is pretty new.  I have a Best Buy warranty that I think does cover things like this.  Anyway, I did not recall the error message that came up.  I was playing Rock Band and it froze in the middle of a song and one red light came on, on the bottom right.  I did some research and the only thing I could find that seemed similar was this hardware failure message.  I took some advice from the Xbox site and disconnected all the wires and HDD from the system, then reconnected them.  It has worked fine since. I think maybe the USB cable for the RB drum set wasn't plugged in all the way, maybe?  I dunno.  I am just happy it works now.