This keeps changing. Hackers Versus Microsoft. Microsoft can always introduce new difficulties to the hacking community by releasing different versions of the Microsoft dashboard, especially for those who have a desire to use a newer dashboard such as using "Xbox Live!" (or maybe just certain features on "Xbox Live!"). Newer versions of games can be released to reduce the effectiveness of using save game hacks (MechAssault has done this). Newer motherboard and kernel versions can cause difficulty for those purchasing newer systems and wanting to hack their Xbox. Since Microsoft makes the Xbox systems and the official Microsoft dashboard, Microsoft has some advantages.
The hacking community has some things on their side too, though. Microsoft has some limitations on what it can do to an Xbox and limit the troubles they cause to the hacking community and not causing any real problems (other than a possible forced download for Xbox Live! users?) for those who have not tried to use any sort of hacks on an Xbox. For instance, in order to make sure that all official Xbox games work, anyone can use a saved game exploit on any Xbox and successfully run Evolution-X RemoteX (with its built in FTP server) if they own a copy of a game that has a bug which can be exploited with a saved game. Also, any changes made to newer Xbox motherboards won't impact those who have already bought an Xbox or will soon be buying one of the already-manufactured Xboxes which may be sitting on a store's shelf.
Ultimately, hackers will end up being able to do something Microsoft doesn't want them to do: Run unsigned code such as Linux. Users of mod-chips that can have their modifications turned off should be able to use an Xbox normally or use their hacks. However, using saved game exploits can be inconvenient (and impossible for those who don't have the game which is exploited), and not everyone interested in hacking an Xbox has a mod-chip. For this reason, the hacking community would like to be able to run unsigned code from the Microsoft dashboard. Whether this can be done or not depends on what happens in the future, and the victors of this battle could be either side.
Eventually Microsoft will stop caring about the Xbox (after another video game system by Microsoft is released), and then Microsoft won't be doing anything further to irritate the hacker community.
How easy or possible it will be for those users or others to use a dashboard exploit on the final (best?) version of Microsoft's dashboard will depend at least partially on what steps Microsoft takes to resist dashboard hacking, and whether it is possible for someone to still find some way to hack the dashboard using only software, and if it is possible, whether any experienced hacker will take the time to successfully discover that possibility and document it for the general Xbox hacking community.
Until that day when the final outcome seems sealed in the hackers' favor (when Microsoft seems to stop spending any significant effort trying to battle the attempts of those hacking the original Xbox) or when it seems sealed to be forever in Microsoft's favor (hackers do not find a way to penetrate the Xbox), the two sides may continue their history of leap-frogging each other, where the hacking community defeats Microsoft's attempts by finding some new obscure method of doing things, and then Microsoft eventually patching up that hole.