Personally, I think the moron deserved it.
First off, if you're dumb enough to cheat at the game and not play in offline mode then that should be enough alone to get you banned. You're just an idiot if you do something that stupid.
Second, if you cheated at Dead Rising, Bioshock, or any other single player 360 game and got 1000/1000 achievements, should you be banned?
Yes.
Same thing here. The idiot cheated, got achievements through cheating (whether that was his goal or not), and now the guy is paying the price. Hopefully he learned his lesson and good for Blizzard.
-edit-
And I'm not trying to act all high and mighty like I've never cheated at a single player game or you're some kind of pussy if you do cheat, Hell, I only beat some of the campaigns in Starcraft by cheating, but I did that because it affected nobody else. If you cheat in Stsarcraft II, you should do it offline. That way you gain no achievements and affect nothing else, plains and simple.
