My brother has the Wasabi 360, he said its best one to get as its pretty easy to install and also does an automatic drive key retrieval. The xk3y you'll still need to manually get the drive key using your computers sata controller and a probe3 (if your drive is a liteon).
You can find an easy installation guide for both the phat and slim versions in .pdf format on the wasabi website (
http://wasabi360.com/download.html).
As for Safe on Live.. I aint too sure I should imagine as long as you backup ISO is put through abgx360 and is successfully stealth patched and the correct topology is injected especially for your XGD3 titles you should be safe as houses, i read somewhere that Microsoft are catching people out because of cheap media discs and them giving bad PI & PIF results. With both the xk3y & the wasabi 360 there is no disc so i doubt you could get flagged. But just remember even though it "may" be safe at the moment, things change and they can change quite quickly.
My brother has been playing his legal backup copys of Battlefield 3 and Black Ops online for awhile now and hasn't been flagged, think he made a backup of ME3 a couple of days ago and has been playing that online too. But each day he is checking his x value just incase.