You wrap it in a blanket to fix it?
Oh the wonder's of modern-day games consoles!! Never had none of this shit with anything pre seventh gen!! Dreamcast and PSX ftw!!
Send it back to MS and get it fixed since its still under warranty - right now its worth diddly squat, Argos were selling them for £99 brand new, so its not fully working, don't expect much for it.
i'm guessing you haven't heard the hundreds of weird and wonderful ways to make an xbox 360 seemingly fix itself. people put them in all sorts such as blankets, freezers and even microwaves (no joke) the problem with ALL xbox 360's is how the system moves it heat from the GPU and CPU to the external fans located at the back and right side of the console. after various internal motherboard revisions they have still failed to curb it. the jasper set has an additional heat sink but that builds up too quickly and simply delays the enevitable. you best get it fixed by Micrsoft in warranty and then sell it to optimize profit. if tht cannot be done seek out a local shop that can repair it and or even better get it modified as they are higher valued.
and yes Dreamcast, PSX, SNES, AmigaCD32, N64, Mega Drive FTW!