Last night, after having my external dvd drive fail at loading my retail OS X disc after loading the boot disc, I tried my Xbox 360 drive with the I/O to USB cable that comes with it. After loading the boot disc successfully, I put in my OS X disc and waited about 3 minutes. It said to press any key to boot from cd or F8 for advanced options. I hit any key, and it failed to load bringing up time out errors.
However, I did the process over and hit F8 for advanced options, which let me select "Install OS 10.5.4". At this point it looked like nothing was happening, but the dvd was spinning, and I walked away for about 15 minutes, returned, and there was the MAC install screen.
So. if you have a Xbox 360 HD DVD drive, you should be good to go! JUST BE PATIENT!!!