I would agree - it wouldn't be very efficient as a carputer. It may be cool, but is it worth the hassle? How about just buying an empty shell and throwing your ITX in there? You could at least build it the way you want and add any peripherals with relative ease.
You could even add emulators/ROM's of your old NES/SNES/Genesis/N64/Gameboy/GBA games and use an old Nintendo controller hooked up via USB. I guess I'm missing the whole point of playing XBOX games, but you are going to go through a lot of hassle if you want to convert the xbox to a carputer.
Also, I'm in Los Angeles - if anyone wants help modding their xbox - shoot me a PM and I'll gladly help out.