Suggestion:
The delicious low hanging fruit allures you well. I will give you the stint so you can make an informed decision.
YES you can download xbox 360 games YES you can play them on your xbox 360. This requires that the dvd firmware is flashed so it won't check for the security
And YES you can enjoy many downloaded games.
BUT and this is a BUT you need to remember it takes one bad rip and you are flagged. Then you are banned and your console is an "offline" console from then on. Now you might say "But the games are free" well how about this "How about the DLC? Playing with your Friends? Enjoying what Xbox Live adds to your game experience"
So that is the stint yes you can but in the end it won' t make you happier.

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