That is ridiculous. Why the fuck would they even *CARE* what time it is? Clearly this is some sort of weird nosy behavior practice, although why they would want to spy on your CLOCK is beyond me.
I'm assuming the thought process goes something like this:
XBL autoupdates time.
all Xboxes should share the same time.
any Xbox with a different time is modded, thus evil, thus a dirty dirty cheater, kill it! kill it with fire!
But that's just me guessing.