Xbox Live’s code of conduct has been updated to allow references to users’ sexuality in profiles and Gamertags, Microsoft announced today.

Previously, “to prevent the use of these terms as insults or slurs,” Live’s general manager Marc Whitten wrote in the note announcing the changes, certain “expressions of self identification” were not allowed. After hearing feedback from its customers however, the company has eased restrictions and now allows the use of the terms “lesbian,” “gay,” “bi,” “transgender” and “straight”.

Naturally, this also means “increased stringency and enforcement to prevent the misuse of these terms.”

“I truly believe that our diversity is what makes us strong: diversity in gaming and entertainment options, and diversity in the people that make up this amazing community.”

The increased talk of Project Natal’s input delay issues are “frustrating” Peter Molyneux; in an interview with gi.biz, the Lionhead and MGS Europe boss explains that the worries are unwarranted and that, since Microsoft’s X10 event less than a month ago, Natal has seen “countless” revisions of both cameras and software.

“It’s always a huge frustration as a designer when you see somebody play a version when you know it’s been exceeded many times over. It so often happens, because you do a version for a show and then you don’t do another version because you’re too busy developing the game,” he explains.

“So very often you get a position that what a person’s looking at is two, three, four months, a year old and you kind of want to go, ‘no, no, it’s 10 times better than that!’ So it is very, very frustrating; it always is – there’s just countless revisions of cameras since the one at X10 and countless revisions of software.”

Natal’s latest iteration, according to a Microsoft source also referenced in the gi.biz piece, is in fact ten times more responsive than the one BBC presenter Jonathan Ross — who called it “impressive” but “not quite there yet” — got to sample last month.

During last week’s episode of GT’s Bonus Round, Wedbush Securities analyst and industry guru Michael Pachter predicted that the price for an Xbox Live Gold subscription would be going up. Said Pachter during the show, “You can’t hook a guy into Xbox Live Gold if he’s playing on a PC … that’s the other problem — you really want to hook every gamer who has a 360, you want them to buy all their games on 360, play everything multiplayer, pay you 50 bucks a year so that, in a couple years, it’s a 100 bucks a year. And that’s going up, we all know that … it’s a profit deal,”

Videogamer spoke to Xbox Live Europe general manager Jerry Johnson, who has now summarily denied the potential price hike. “I can tell you it wasn’t directed or tied to anything actually going on within our group,” spoke Johnson.  ”I find it flattering that someone feels that the value of what we’re delivering is worth more than what we’re charging. That couldn’t have been popular with other press. Unless he was trying to be sensationalistic to get a quote out there.”

So, does that lay the issue to rest? Or does a price increase still lurk? This of course would not be the first time that a videogame company has told the press one thing and then another. But, if we’re to take Johnson’s words at face value, then it looks like our Xbox Live subscriptions will be holding steady at $50/£40.

It’s always thrilling to turn on a console and see that an update is waiting to be downloaded. More often than not they’re small changes that no one cares about (I’m looking at you PS3), but every once in a while the anticipation builds to the point of producing extreme excitement. This feeling is what Microsoft is looking to provoke with its Fall dashboard update that will bring Twitter and Facebook to the Xbox 360. While a release date hasn’t been officially announced, the UK Xbox website cites November 17, 2009 as the release date for these new services.

A quick look on the US Xbox site turned up nothing unfortunately. The rest of the world will have to sit and loath the UK until another release date slip is made.

Microsoft has announced today that the Xbox 360’s Games on Demand service is getting six new titles added this month. Joining Rainbow Six Vegas 2 and Call of Duty 3, which were added earlier this week, are Grand Theft Auto IV (Oct. 13), Midnight Club: Los Angeles, Army of Two, Sonic Unleashed (Oct. 20), and Dead Space and Dirt (Oct. 27).

Microsoft also announced it will be releasing new Avatar clothing throughout the month, including Halloween clothing, GamerchiX branded apparel for the ladies, and more.

And finally, the company also detailed their deals for the month – Prince of Persia: Epilogue (Oct. 5), Hasbro Family Game Night (Oct. 12), Resident Evil 5’s Versus Mode (Oct. 19), and Fable II Pub Games (Oct. 26).

The Chair-developed Shadow Complex ended Xbox Live’s Summer of Arcade 2009 with a bit of a bang, Microsoft has announced today, by setting a new record for the most downloaded single-player title in Live Arcade’s history to date. It managed this feat by selling through 200,000 digital copies in its first week of availability, and Epic Games’ prez Dr. Michael Capps is naturally proud of their subsidiary, “Chair’s goal was to make a gorgeous game with tons of action, addictive challenges, and a great sense of exploration – and they knocked it out of the park. We’re so proud to have Shadow Complex join the Epic portfolio.”

Whether or not it can become the most downloaded gamer on Live Arcade, period, remains to be seen. But it certainly has some catching up to do.

Rare is one of the industry’s more beloved studios. Or rather, it was once upon a time. Nowadays Rare is little more than a footnote in Microsoft’s gaming division. A very, very expensive footnote. Microsoft expected the studio to churn out multi-million selling hits that they peppered Nintendo with, but games like Viva Pinata and Perfect Dark Zero are a far cry from what Microsoft expected sales-wise. And so, Rare quietly retreated from stage center and have since been “that” studio people know about but don’t expect much out of. This has a lot to do with the studio itself being so secretive, using the Nintendo strategy of keeping its games close to heart until they’re absolutely sure nothing will go wrong. That’s all well and good but its not exactly conducive to the creation of hype and general excitement.

Peter “Euro-Head-Honcho” Molyneux wants to change all of that. In an interview with GI, Molyneux outlined some goals he had for Microsoft’s European projects and regarding Rare, Molyneux said, “one of the things I really want to do is help Rare have more of an identity. And make sure the people at Rare are seen more within the industry…I just want to give them the confidence to tell the world what they’re doing. I hope you’re going to see more from Rare and I want to help them get well known. But you’ll definitely still recognise a Rare game.”

Super. Now let’s see Rare actually show me a new game and remind me of my childhood reverence.

At today’s Microsoft keynote, the rumors that Crackdown 2 was being developed were (thankfully) confirmed. All that was shown at the conference was a short trailer, which left me drooling. The trailer itself didnt present any exciting details, however we do know the sequel is being developed by Ruffian Games. A small press release accompanied the trailer, and here is what it had to say:

Coming exclusively to Xbox 360, “Crackdown 2” will take multiplayer gaming to unprecedented levels for the ultimate cooperative and competitive multiplayer experience, providing you and your friends with the complete freedom to explore, destroy and play as you return to restore justice and peace to Pacific City — by any means necessary.

Many titles claim to be “unprecedented,” but judging by the sheer amount of fun I had with the original, I am inclined to believe it this time. Also, you did read the word “competitive,” didn’t you? There aren’t any real details for the game at all so far, so there is still much to be revealed. Will Crackdown 2 support more than 2 players? What kind of Versus modes will it have? Will Ruffian have enough sense to include split-screen play? Keep it tuned to GamesAreEvil and we’ll let you know as soon as the answers pour in. Crackdown 2 is slated for release sometime in 2010.

Xbox Live General Manager Mark Whitten provided more information at the aforementioned luncheon that could not be fit in the regular briefing, this time concerning the streaming of games.  Whitten said that a new service will be introduced in August that will sell full retail Xbox 360 games over Xbox Live. The launch titles for this new service will consist of BioShock, Assassin’s Creed, Oblivion, Mass Effect, and Crackdown.

The games will be available for actual monetary figures instead of Microsoft Points, as the system will accept credit card payments.