Same here.
Can you get banned? Yes. But it depends on the situation. A good friend of mine said that complaints are only valid if the person played with you, and it can usually take around 10 complaints on the same subject to even get noticed. Even then, it's more likely they don't suspend/ban you.
It depends on how you behave. If you harass other players, then probably. I used to drive around and spawn vehicles, and generally keep people happy. Modding GTA IV on the Xbox is no different than modding GTA IV on the PC, the only difference is that the mods are more focused on cheating compared to PC. But you can find mods similar to the PC, such as the superman mod.
Anyway, LCPDFR on Xbox 360 is somewhat an insult to G17 Media. They should have used a different name, but I have no problem with them expanding and improving console mods. They've made a lot of progress the last few years. I disagree with people using mods to cheat, but I don't have a problem with people using mods to expand and add fun to the game.
I thought I would clear that up for some people, because I've read far too many posts saying "You're going to be banned permanently by Microsoft". In reality, it depends on the person using the mods, not the mods themselves.
Nick