Are you experiencing long login times with your Xbox Gamertag (GT)? This little post on an Xbox forum may explain it.
So those of you with Flagged Gamertags now know why it's taking so long to log into Live, even though your Xbox is a stock, unmodded one (anyway, it will be hard to get a modded console soon anyway, once the law changes, and modding of consoles is consider illegal in Singapore. Damn FTAs).
When your Xbox is banned from Xbox Live, MS is BANNING your EEPROM, BANNING your HDD, and FLAGGING your GT. Keep in mind that MS is NOT BANNING your GT, they are FLAGGING it. There is a huge difference!
Everyone with me? Good.
By flagging your GT, MS knows you have been previously banned, and will begin performing more extensive tests on any Xbox connecting with that GT, to determine if it has been modded. Part of these extensive tests is MS checking to see if you have a stock HDD installed. If you don't, then you're banned.
At this point, you're probably asking why MS isn't doing this for all GTs, instead of just certain GTs. I'll tell you. MS has just developed this banning system, and it is far from fully tested. The last thing MS wants to do is accidentally ban a clean Xbox. So for now, they're just running the extensive tests on Xboxes connecting with the flagged GTs. If this is the case, we can all expect it to change in the near future, which will suck beyond all recognition.
In summary, this means that your flagged GT will work in a clean Xbox, but not in a modded Xbox with a non-stock HDD for example.