The problem is the broad nature of the DMCA makes any hack or exploit effectively illegal, even if it increases the features of the hardware without leading to piracy, or gives you the ability to do things that would normally be covered under fair use.
"Ars Technica also contacted the Entertainment Software Association for their thoughts on the matter. Surely there is room for consumers to modify the systems they buy if they don't pirate, right? "The technological measures that video game companies use to control or manage access to their works and to prevent unauthorized copying are essential to ensuring the viability of a vibrant video game marketplace," Ken Doroshow, ESA General Counsel & Senior Vice President, told Ars. "These technological measures protect the intellectual property rights on which video game companies depend to create and publish new games." The ESA's view is that you can't mess with your systems, no matter how benign your intention. "Circumventing these protections is never 'harmless fun,' as it erodes the foundation on which video game industry depends for its success.""
http://arstechnica.com/gaming/2009/08/modder-arrest-a-reminder-that-most-console-hacks-are-illegal/ Conflicting statements in the article, but my guess is that if a console maker wanted to sue him, they probably could, just on the basis of protecting design copyrights.
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