Does flash speed really matter for Xbox 360 usage in this case? I'm curious if it would matter.

I have a Wii that I Soft Modded with a USB Loader. You can google it. It allows you to use a USB HDD w/ your Wii and store all your games on the HDD. It doesn't require any mod-chip and as long as you only store/rip games you actually own, it should be 'legal'. No piracy required. Using a USB 2.0, I can play my Wii games w/ no lag. So USB 2.0 seems fast enough to handle HDD speeds, which has a slower read speed than flash.