The Xbox system error e74 is a common problem with the Xbox 360. It will make your Xbox unplayable but it is not dead. This happens over time when you play your Xbox. Each time you play your Xbox you heat it up, when you stop playing it cools off.
This heating and cooling process makes the X-clamps weak overtime. The X-clamps are the pieces of metal that hold the heat sink on the the graphics processing unit and the central processing unit also known as the GPU and CPU. When the metal gets weaker over time it will cause the heat sink to lose pressure on the chips allowing them to over heat and malfunction. This is what happened with your Xbox as well as mine.
The Xbox system error e74 is a error message is caused by the GPU when it overheats. I first got my error E74 message 2 1/2 years after buying my Xbox brand new. I thought their was no hope for it and I was about ready to throw it away. I decided to search the net for any information regarding this E74 problem and all I was able to find was the towel trick and the penny trick.
Now I am not an electronics major or anything but I do know if you cut off the air flow to a device and over heat it to the point of having the solder melt it can’t be a good thing. I dug deeper in the net and found that the towel trick will fatally kill your Xbox beyond repair after a week or two. So if you want to try the towel trick and ruin your Xbox go right ahead. If you want to fix it forever I suggest getting the guide I used to fix my Xbox. It was easy, 30 minutes and I was done.