We've seen a lot of news on scratched discs here, but Microsoft still claim that it's an "isolated problem". Careful, though, if you're a GameFly rental customer and return a scratched disc to them, they'll invoke their official policy:
We have received reports that certain XBOX 360 consoles have caused damage to GameFly videogames. Unfortunately, we have been notified that you recently returned a damaged XBOX 360 game. As a precaution, we have removed all XBOX 360 games from your GameQ... In the future, should GameFly receive XBOX 360 games from you that have been damaged, you will be charged a replacement fee.
Seems that GameFly know where to squarely point the blame. It's a sensible enough move, but just how big is the scratched disc problem?