Well that's installing from disc but still using it to play the game, a precursor to the way it continued to work on future Xboxes (with the differences that install was optional on 360, and that on later Xboxes sometimes games required a download to even install).
This rumor would have to be a step further.
When we go to the beach on vacation each year I always make a point to stop in their local bookshop. Selection and moreso price aren't great, but it's always so much fun just to look around.
Went the past week and picked up:
20,000 Leagues Under the Sea (Verne) Secret History (Tartt) Tomorrow and Tomorrow and Tomorrow (Zevin) And Then There Were None (Christie) Zen and the Art of Motorcycle Maintenance (Pirsig)