Actually... I'm pretty sure it just means you have more than one machine on the network, trying to use the same IP address. Nothing to do with Xbox Live.
If you're using DHCP, make sure all the machines connected on the network have different IP's assigned. Also, I think Xbox uses static IP (don't think you can use DHCP unless you mod it), so it's possible it's got an IP address that's the same as another machine.
If you've manually assigned all the IP addresses to machines (ie: no DHCP/NAT/Router), go back through them and make sure all are using unique IP's.
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