Nice to see we get a nicer to look at dashboard, but there are other things that are in need of immediate fixing, as far as I'm concerned.
First off, hitting the Guide button by mistake is murder, especially in shooters, because there's a good 2-3 second delay between when you hit the button and when the blade is ready to display. I don't know what kind of monstrous code is hiding under that blade, but something needs to be optimized and have that blade out INSTANTLY, then INSTANTLY closeable.
Secondly, DivX/AVI support. As a 360 owner, this reeeeeaally kills me. Microsoft has put on this big push as the 360 being the entertainment hub of the house, especially with their Media Center connectivity feature (the reason I got Media Center to begin with), but once you're connected, all you can play are WMVs, and if you're lucky, the occasional AVI. Microsoft, wake up, Everything comes in AVI these days. The PS3 has full support, why can't we? Between that and Blu-ray, I've decided to pick up a PS3 this boxing day - enough is enough.
Third, we need a controller reassign feature. PS3 does it, we should be able to do it. Whether it's because I don't want my drum set becoming P1 everytime I turn on my 360 because it's the only thing physically plugged in with a cord, or that I want to switch from my Les Paul to my strat for Long Time's Big Rock Ending, there's no reason that this feature isn't there. I can only pray they'll put it in.
Lastly, not really part of the dash update, but we need a bigger hard drive for somewhere in the region of $40-50. I have under 1GB left after downloading a few Xbox originals, a bunch of Rock Band tracks, Halo/COD maps, arcade games... a demo or two. Nothing excessive, but 20GB is downright unreasonable in a time of digital distribution, and even more unreasonable is charging $170 for 120GB, which they can because there's nowhere else to look - we're locked into their first-party offerings. Hell, Amazon.ca offers it for.... $209. Yeah, you read that right, that's $1.75 per GB. One more reason I'm looking to pick up a PS3.
I have other stuff, but I'm in a hurry here. Please, add your ideas here, maybe we can send MS some emails or something, but with the console having been on the market three years by the time this update rolls out, something needs to be done to address this stuff.