Avatars
These will not, as originally thought, totally replace Gamer Pics and themes. For the people who paid for those, you'll still be able to use them if you want. Great news for me, because there's no way I'm giving up my Street Fighter theme without a fight. In fact, in mockups seen on other sites, Themes may look even better with the new Xbox Experience menu.
Avatars have a lot of developers excited. There's discussion of Achievements unlocking outfits for the avatars to wear and of game completion unlocking other outfits. Developers are looking to use the Avatars in a similar fashion to achievements, to provide more reasons for a player to complete their game.
New Display
For those who've been calling for it, the new update adds 16:10 resolution support through VGA or HDMI. This includes support for the resolutions 1680x1050 and 1440x900.
HD Install
In a feature I covered in an earlier article, we've got more information. Firstly, this is a system-side feature meaning that every single Xbox 360 game can now be installed. Furthermore, for those of you with Lost Odyssey who really don't want to swap discs, you can install the entire game to your hard drive. You can even, if you want, install just one or two discs of a multiple disc game and not experience any interference in gameplay.
Marketplace
At work when a new XBLA game comes out? Frustrated because you're on a vacation when a new map pack hits? Well, now you can view the marketplace and make purchases through Xbox.com. Though the Major didn't go too in-depth on this new feature, it sounds like once you make a purchase through the site those downloads are pushed through to your Active Downloads.
Live Party
As revealed earlier, Live Party is functionally similar to an 8 way private chat. You and 7 other Xbox Live members can get together, join games, watch movies, and a variety of other activities. Revealed in the podcast is the news that members of one live party do not have to share activities. So, four people could be working the ranks in Halo 3, 2 members doing a run through on Gears of War 2, and 2 other members in entirely different games and all 8 would still be able to chat with each other.
Dashboard Into the Guide
For fans of the current Dashboard, all of the same functionality will be built into the Guide. The current Guide is simply replaced with the Dashboard, with themes and Gamer Pics intact. One thing, however, won't be making it into this new dashboard: Ads. Ads will remain in the new Xbox Experience front end, but will be gone from the new dashboard guide. In another improvement, this dashboard will be context sensitive. So, if you've got Halo 3 in and you head to the market throught he dashboard, the dashboard takes you to the Halo 3 section of the marketplace automatically. This is a particularly useful feature for Guitar Hero and Rock Band owners, in my opinion.
http://www.talkxbox.com/article2612.html