I've seen over 10 threads on various forums with people having this issue (Including me). I sent my xbox in last Friday because it gave me 1 ring and error E74. I called M$ that night (Yes they where open), and told them the situation. They said my console was in warranty and it will be covered. They will ask you to try different A/V cords, just tell them you have tried with no success. It will speed things up. Right now, the online status shows "Repair in Progress", its been like that since Friday. Hopefully it will be completed by tommorrow, and be on its marry way.
If you have a spare box with padding, I suggest you go along with their E-Label option, as it is faster than waiting for a box.