I am in possession of a slightly useless first-gen xbox; it freezes up during fast games but otherwise works perfectly. Thus, I was the perfect candidate for trying this - nothing to lose!
I shall chronicle for you how I oil-cooled my xbox with around-the-house items for a net amount of $0. It doesn't look as good as the nice way, but great for the student or just generally cheap diyer.
NOTE: yeah, the desk I'm doing this on isn't clean. Deal with it.
BIG NOTE: I'm not responsible for any damage to your xbox, spills, nuclear war, etc. It's your problem. Worked for me, but I can't guarantee you won't screw it up.