i played on xbox live during wave 2 with no problems but then wave 3 came and i had patch my games to even play them and i read that i couldnt play on xbox live and that i would get banned wat are my chances of gettin banned and wat will happen will i still be able to get updates?

Always use the latest firmware. If you don't, your risking getting banned.

You're always risking getting banned by using a mod firmware, but by using the newset versions you minimize the risk.

And if you have your key.bin etc, updating should be faster than the first time the drive was flashed.