I'm personally more concerned that Microsoft is aware enough of how we play that they can label us cheaters for tampering with something as basically harmless and meaningless as a gamerscore. And that they have the power to cause those of us who are already outcast to be even further alienated, and are unafraid to use it.
I mean, it'd be fair enough to be so harsh if this were a competition where money is involved, but really, it would've been more prudent to do something a little less publicly and personally humiliating than change every cheater's name to "cheat". Even banning them at least doesn't lead to social alienation and the like from others in the hardcore community.
Banning, most likely, wouldn't end up published in the media either, because the attitude would be "move on and play something else, you little brat." Instead, it's become a public dignity issue and I understand why I'd be angry in the mother's position too. We all used to cheat in games all the time in the times before internet gaming made games massively multiplayer. Why do we suddenly think it's okay to victimise people who've bent the rules in a freaking simulation? The bland, "oh that's just fine, he got what was coming to him" reaction I see from some here is, to be frank, ridiculous.
We should really ask ourselves if it's worth humiliating someone who may or may not have a mental issue (and may or may not get unhinged or sent into a breakdown by the stigmas attached to "cheating" and the like, depending on the extremity of his autism) just to please a few die-hard fans of Live who want their names in the Hall of Fame or whatever without cheating for it. And yeah, when creating a social system, you need to consider what will happen to the lowest social denominator - the mentally ill and other minorities - because they will use it too. This PR issue is causing Microsoft trouble and rightly so, they could have done more to prevent it from ever happening.
My view is that Microsoft should deal with cheaters in a more mature manner, and give the poor kid his account back. The games should be updated and patched against the power of exploits anyway, rather than having quick socialising fixes like humiliation. The fact that people are humiliated in such a way is a pathetic showing off of the cutting-corners philosophy that is the ugliest face of Microsoft's corporate personality. That, or a show of exactly how much more growing up the gaming industry has to do. Seriously guys, get it together.