Make some amount of "live arcade" dollars unlockable by completing achievements in a game, or as a reward system for online tournaments a la magic: the gathering online.
No thanks. Giving them away for free would knacker the economics of Live Arcade, particularly for the independent developers who need the cut that they get from sales to stay afloat and produce new titles. It'd work for tournaments if the organisers paid Microsoft the equivelent monetary value to subsidize that amount given away, but whats the point when you can just give the winner the actual money? Achivements would be totally unfeasable as they are to easy to obtain and limitless in quanity, hence giving them away for those would be uttery devaulating with no compensation or hideously expensive for the publisher with it.
What that guy said. It wouldn't work unless it was a very small, almost completely ridiculous amount of points to a omfgz acheivement points.
That or they would increase the cost of the games to make up for it. And if you could spend your achievement points then how can you show off the size of your e- penis?