Sorry, but I don't think that's ironic.
The xbox is a windows box like all the other PCs around the world, only more specialised and lower cost. Like all the those other PCs, MS software monopolises as many resources as possible, in an effort to dissuade the installation of alternative OSs.
OK, the challenge of hacking the xbox is much bigger, and credit is due to the project, but Windows is hardly touted on its security and stability. if yuou also think consider that MS traditionally have not manufactured / distributed hardware, you will see that the chances of xbox getting hacked were always going to be high.
So , I don't think "Linux on Xbox" is anything more than a small pockmark on MS's medieval armour. At this moment.
However, if the whole clustering method that the Linux on Xbox enables starts to show reliability over time, then it could start to pose as an alternative to other MS products. Then it may be it would ironic then.