I couldn't get this to work myself. I remember a friend and I being completely stumped while troubleshooting the same issue many years ago --- and we had modchips, not softmods.
I believe there was even an app created specifically for this task and it never worked either
Well I might try to do a softmod today and do an Xbox to Xbox transfer (using a hub and a couple of ethernet cables rather than a crossover cable). I'll let you know how it goes.
The following probably doesn't apply here but is worth knowing about anyway.
XBOX Live Block
All games should be patched with smo's patch to disable Xblive.
All MS dash .xbe's should be patched to block the network completely,
stopping dash updates which the first patch does not.
Please note that this last patch effects all .xbe's with the same titleID as the
MS dash. So if you are working on an MS dash mod (thc, blackstormx, etc), please
change your titleID if you are including any networking capabilities, such as FTP.
I noticed yesterday that Qwix has an option to change the titleID of the .xbe but... I think this wouldn't matter whatsoever with avalaunch anyway.