Does anyone know anything about that Lawsuit anymore? I lost track of it.
It doesn't necessarily kill your 360. It's as Sean said, Halo 3 just works the system rather hard and under the wrong conditions, the 360 will most likely start working improperly.
I've said this before, but I've had my 360 near 2 yrs now and the worst that I get is a hard-drive failure error occasionally, which is fixed with by turning it off then back on.
I believe any system you use will not last forever(NES for example). Systems such as these are designed to have a time limit on their usage. The question is, "How long is that?" Only Microsoft knows for sure, but if they went around telling everyone no one would buy anything knowing its going to fail no matter what. Proper care and use will prolong the life of any kind of hardware.
These types of things are the reason we change our oil in our cars and other maintenance.
Product failure is always taken into consideration when designing something. It's also known as the Factor of Safety(or FOS) to engineers and designers. It all involves stress analysis, evironmental conditions, and many other factors. Check this out if you're interested about this stuff. It's more for the structural side of engineering, but this really applies to just about everything that's made and used in our everyday lives.
Click - Limit State Design
The short version - you take risks buying anything and everything, but usually something serves it's purpose before it fails/breaks/quits working.
-Magnum