I still enjoy dropping in on Why Was I Banned? every so often, but not being a l33t Xbox haxxor, I don't understand a lot of the terminology. Fortunately, some of my colleagues were kind enough to explain them to me. (And now I'm explaining them to you so that you don't have to look as stupid asking them.)
A modded lobby is a pre-game lobby (a server you connect to in order to find other people to play with or against) that has been modified (modded) with carefully-crafted parameters so that they grant people who visit them various advantages. For example, the reward for winning the game could be some absurd number of experience points. Sometimes the reward is granted merely for visiting the lobby; you don't need to actually play the game.
A glitch lobby is a modded lobby that takes advantage of a bug (glitch) in the software. An infection lobby is a modded lobby that modifies (infects) your character so that the modification persists even after you leave the modded lobby and return to regular play.
I mused that it would be interesting (if possibly ultimately a bad idea) to create a separate universe for all the modded accounts. You aren't banned from Xbox entirely, but your account has been moved permanently to the mod universe. You're allowed to play games only against other modded accounts. Soon, you will realize that other people are much better than modding than you, and the result is that the gameplay is totally unfair and not fun at all.
And if you complain that the mod universe is totally unfair and no fun at all, then everybody laughs at you and you earn the IRONY badge.
(At least until somebody comes up with a mod that removes the IRONY badge.)