Well I figure as long as I give relevent information, then I can sprinkle in the whining.
If you look carefully at the website they say that you can install a mod chip that contains the boot code to get linux running. That mod chip has the ability to turn itself off and let the regular MS bios take over.
Sorry, there is currently no easy way to use Xbox Live and Linux on the same Xbox. Microsoft blocks everyone from Xbox Live who alters the Xbox; installing Linux is considered as "altering" by Microsoft.
If you're more experienced, you can get an Xbox modchip that can be turned off completely and use "Cromwell" with it. Turn the modchip on, and you can run Linux. Turn the modchip off, and you can join the Xbox Live network.
The Xbox Linux project does not actively support this at the moment, sorry.
They probably don't support it because you have to know what your doing to use it properly and not fry your system. (Ever taken any electronics classes before?) Plus it's probably kind-of expensive.
Thats what you need to get Linux running on your laptop and still get online with Microsoft's live stuff. (funny how I've been playing online games for years and never had to pay for it (except for voluntary contrubutions) and yet I could still modify my computer, itsn't it?)
Otherwise it's a no-go.
If you still want to do a linux something for a school project go and get a old computer from somewere. I got a old 800mhz computer free from my parents a few months ago I and turned it into a wireless access point + a MythTV (TiVo-type thing) frontend. Anything faster then 133 or 200mhz cpu with at least 64megs of RAM would make a great linux server.
It wouldn't be that hard to setup a web server or whatnot and put a simple web page on it. Do that, document the steps, and explain some of the concepts behind it and you'd probably get a A or whatever.