lets say i buy a game on an account on my xbox. i then give the account with the bought game to a friend. now, i know he can download the game and play it as long as that account (which bought the game) is logged in.
what happens if my friend wants to play with his gamertag through xbox live? can he just have the 2nd account logged in but not playing? or would the account which owns the game HAVE to have xbox live in order for him to play online?
If you buy and download a game under your GT on your console and you want to share it with someone, they have to download your profile on their console, do a license transfer and then download the game(s).
You will still be able to play your games on your console, but since your friend did a license transfer, you must remain online otherwise your DLC/XBLA games will not work.
Also, I believe your profile has to stay on his console as well, but he doesn't have to be logged into it to play your games. --- Your = belonging to you, you're = you are, their = belonging to them, they're = they are, there = not here. http://i.imgur.com/UzTVQwG.jpg