Modding is, by all defenitions, essentially illegal. Why? Because game companies assume you'll use it to play illegally burned games. So in a hypothetical situation, if you got caught with a modded system, you really can't use "I wasn't going to play illegal games on it! I swear!" as a valid defense.
The record industry of America can assume that anyone with a file-sharing service and/or mp3's is violating copyrighted music laws, even if you've only ripped mp3's from the CDs you own. And since possession is (approximately) 9/10nths of the law, you'd be screwed if they actually came after you.
Point is that the companies assume you will do something illegal, and by having the tools to DO something illegal, you're a valid target to have legal action taken against you.
So point is that you'd be screwed if Nintendo actually came after you.
Now let's not be silly - not ALL things you do to your system are illegal. Afterburner, Console Colors, etc., cosmetic changes don't count. Screwing around with the innards of your machine is where the legalities start to trickle in. Your friend with the Linux-Box? He can't play with Microsoft's Live! service. Why? Because they are scared he'd hack it to peices and release viruses on the servers. He probably WON'T, but that doesn't mean MIcrosoft won't take the precaution. (Of course, this is what happens when you put unnecessary crap in a console, such as a hard drive.)
So keep all that in mind.
But as Rambo said, there's nothing you could do with a modded cube. Last time I checked it doesn't have a hard drive, it's laser doesn't read pressed CDs (meaning you couldn't burn something and run it), and even then you'd need emulators for software and/or a way to install an OS.
So you can't do crap. This thread kinda reminds me of the "Make a GC Candy dish" idea....