Alright, I have a modchip in my Xbox AND Xbox Media Center plus various other Xbox softwares.
First of all, yes, you must mod it to be able to stream. Is it worth it? I don't know if I would do it just to stream some video, but if you want to pirate games you can save yourself some serious cash. It's a fairly difficult process, especially if you're going to use a modchip.
boardordi, I didn't really understand what you're talking about, but yes, if you go on Xbox Live with a modded Xbox, you will be banned. Not just your gamertag, but your EEPROM (a type of read only memory) will be banned, and consequently your Xbox won't be able to go on XBL on any gamertag. That said, if you have a modchip, you can relock the hard drive (set it to read only like it is regularly) and switch off the chip to boot to the normal dashboard and you can play online without a problem. This is one of the advantages of a hardware modchip over a softmod.
And, uh, paperplunger, the BIOS doesn't include a dashboard. The BIOS is the thing where the modchip / softmod tells the Xbox to boot to the alternate dashboard that is installed on the hard drive. Some examples of dashboards are Evolution X, Xbox Media Center, and more. So basically, after you mod the BIOS by a modchip or a softmod, you have to download a dashboard online and install it to the hard drive. The modchip will then boot to the new dashboard and you'll be set.