Be very careful if you own an older XBOX. I had an XBOX 360 Arcade (with an added HD) that was fried by the Kinect software update.
My money says that most people reporting "Kinect killed my Xbox!" just hadn't used their Xbox for a while before getting Kinect. For all we know, the same Xbox might have died the day before.
I'd hesitate before concluding that Kinect is the culprit.
Given that you were swayed by an article that relied on a single point of evidence I would think that the fact I managed to install it somewhere between 5 and 10 times on the same setup should set your mind at ease.
It's no surprise given that MS sold 8 million kinects that a few 360s would die with a RROD shortly after having the kinect plugged in. It's the law of big numbers, so sorry mattgriffin I think you have just been unlucky.
The other key facts you should look at is the date of the BBC article, and the type of reporting the author does. If there was any sort of wide failure with the kinect it would have been reported WIDELY by the gaming press shortly after the kinects release in early November. The fact that a BBC Reporter who seems to cover general news picked this up miles after the launch of the kinect doesn’t fit with the sort of sudden failure you are describing.
TL:DR It’s confirmation bias combined with lazy reporting from the BBC