[Quall999]

In order for these chips to be sold legally, they include a legal set of bios with limited capability. Since these bios include no MS code what-so-ever, it won't even boot standard xbox games.

So, most chips you buy won't do anything until you flash a new set of [hacked] MS bios onto it. Which is pretty easy and we can help you do that if you need it. Basically, all mod chips do the exact same thing since it is the bios that determines capability, and you can choose to flash the same bios on any chip (as long as the bios size will fit onto your chip).

The more expensive chips use the same bios, but have things like custom OS's on them for xbox management (like HDD lock/unlock, eeprom editing, or re-flashing the bios banks). However, most of these can be achieved with software (except the TFT screen add-ons). They are good for devs or beta bios testers, as they have better recovery tools.

Since you have a v1.0 xbox, I would actually suggest a tsop flash (if you have an AR or know someone with it, but don't buy one since a chip is just as much). Else, I suggest the Xecuter x2.6 simply because it supports the newest x2 bios (which are very customizable through a text document, rather than editing the bios directly).

Oh, and to answer your question, the switch turns the chip off. You can play online XBL, but the switch must be off BEFORE you turn the xbox on. So, you cannot and will never be able to play backups on XBL (xlink and xbconnect can though). And the x2.6 supports all version xbox's.