Yup, it's started, reading in this thread has shown the video of the machine booting PGR from a copied disk.
Please note this does not show that you are going to be able to run homebrew stuff on the 360, this will only allow the running of correctly signed application's. However it is a start, I personaly have no issues in purchasing the games I want to play, although a bit of try before you buy would be nice (o MS and the game publishers could put better, more represetative demo's on Live).
I would love XBMC (XBox Media Center) to make it's way to the 360, as I could then banish my XBox to the other room.
Video after the jump.
Or pop along to YouTube yourself