We're all familiar with the etymology behind "Xbox" -- it's a truncation of "DirectX Box". But, as one of the console's creators told Edge, Microsoft lawyers at first weren't too sure of "Xbox" for some reason, and the alternatives favoured by the suits were all hideous.
The final stage of naming the console "was a battle between us and the naming guys, when we decided we just wanted to risk it and go with Xbox," Seamus Blackley (pictured) told Edge, in an interview just now published online. "They wanted, for some unknowable reason, to call it '11-X' or 'Eleven-X'."
Blackley provided Edge with a list of about three dozen alternative names from an earlier stage of the naming battle, "the 'acronym' phase from the naming geniuses," as he called it. You should go check it out, it ranges from MAX to MARZ to MEGA to FACE, everything but WTF. Blackley told Edge there was an even worse list of alternatives, which he threw away, but it included the "Microsoft Bunduss" as a joke making fun of the whole inane process.
Ultimately, "Xbox" won out, as it should have in the first place. Can you imagine calling this thing the E2 and taking that to E3?