Well, now there's a far simpler way: Microsoft will label them "cheater." The Xbox Live Sheriff has begun targeting players who "gain achievements through avoiding game play and the use of external tools" and, as a punishment, resetting their gamerscores to zero, making them "unable to regain all previously earned achievements," and lastly (though, most deliciously), permanently labeling them "as a 'cheater' for the community to view." And, since the "gamerscore correction will remain permanent without any way to appeal" there's a good chance we'll have yet another easy way of identifying cheaters on Xbox Live: the tinny static of their whimpering sobs.
PS - Anyone know of any real accounts flagged "cheater" (besides CheaterMcCheat)? If so, point 'em out in the comments so we can all point and laugh.