For those of us who either do not want to dish out some ludicrous amound of cash for XBox Live, Or a WBox Wifi Antena, or simply have an older model you are not alone. THere are 2 services out now known as Xlink Kai and XBConnect. They both work the same way, where you hook up a PC running thir software to the same LAN as your Xbox/360/GCN/PSP/PS3 that in turn tricks them into thinkin other consoles on the internet are other consoles attempting a system link.
First Choose your service. Xlink Kai supports the Gamecube, XBox, Xbox 360, PS3, and PSP. XBConnect Supports only the original XBOX.
Second, Set up your network. you need to get your console on your network. Since I have the original Xbox, I will use XBConnect, althought th two work exactly te same.
USing an ethernet cable, plug your console into your router. Do the same with your PC, or use Wifi.
Method B-If you have Dual band wifi and widows 7, you can connect to you network via Wifi, then use your Ethernet port to connect to the console, the use Win7 to "bridge the connections."
If you do not have dual band wifi, I recomend using an android phone as a USB wifi adapter by tethering via USB then disabling 3G/4G. THis will simulate dual band wifi. You can do the same with a real USB wifi adapter.
Third, create an account on your service's website, then install their client. Load up a game on your console, and go to the system link option. Wait here until your PC can populate a listy of "games" or servers. Enjoy!