So this has popped up in my mind. If you had a clean Xbox and you put Morrowind in for the very first time... it reads the files off the disc and caches them/stores them somewhere right? So if you wipe the cache of your Xbox, and you were to take your Morrowind disc, then extract the contents and modify them (such as adding music files, changing meshes/textures, adding .esm's to the data files) and then you burn the new copy of your disc and play it on your modded xbox, it would cache the newly added files wouldn't it? I mean technically, you should be able to create your very own version of a Morrowind disc and it should run with all of your edits without you having to hex edit anything, or accessing your cache and whatnot. Right? If you don't understand this explanation, look below for a different explanation.

Original Morrowind Disc + Clean Xbox:
Game is put into the disc drive > Game is read by Xbox > Game files are loaded into the Xbox cache > You can then play the game

Modified Morrowind Disc + Xbox that's already played a clean Morrowind:
Modified Game is put into the disc drive > Game is recognized as Morrowind > Previous Morrowind cache files are loaded > Game is exactly like the Original Morrowind disc

So couldn't this work?

Modified Morrowind Disc + Clean Xbox:
Modified game is put into the disc drive > Game is recognized as Morrowind > Game files are loaded into the xbox cache > Your mods are ALSO loaded into the cache as the Xbox does not know it's a mod > Game is Morrowind, but with your new mods

Theory sounds reasonable. Morrowind caches its files in the X drive so you could just delete those files and you're good. It's also a good idea to remove them if you've added or changed mods.

That would mean if my theory was right and you were a good enough of a modder you could create your own custom game if you will, just by using Morrowind's engine and Construction Set. Stellar.