Well this is different. This console modding, which can be considered a much bigger offense vs. Video Game modding that just requires plugging your HDD into your computer.
thats what i meant i have got my console modded but the law in the UK allows you to as long as you have got the original games
"You are LEGALLY ALLOWED to make a personal backup of any Original game as long as you are the owner of the Original game. However you MUST DESTROY any backups when you don't legally own the Original CD anymore (e.g. selling or giving it away). Before making a backup, check in the supplied manual or on the back of the CD box"
taken from a backup suppliers disclaimer