You can only be Banned Once and lose points and Gold sub - There is no Second time.
You can create 5 GT and have each one is banned but nothing will happen to your console, unless you tinkered with it.
You can be suspended X(?) amount of times they never take your points or gold sub until your banned.
I think its 3 times for COC- someone can correct me on this.
When your Banned you lose all Download rights, IE you can not re-download anything. You automatically lose your Video/Music/TV Show rites (as you need to be connected to live)
Your DLC/XBLA will still stay active on the first console your downloaded them too, just like if the console was not connected to Live. But you can never transfer the license to a new console b/c you forfeited XBL by being Banned