Usually what the "Red Ring Virus" is, is hardware failure. I am pretty sure it is from not keeping the system as cool as it needs to be, like placing the xbox in a thick carpet. Do NOT put any electronic device on a thick, cloth-like material! When this happens, the system cannot keep itself cool, so it heats up big time. When it gets too hot, it will cause some of the hardware to fail, never to be used again. This happened to my friend and he had to send it into Microsoft. I suggest you should do the same, or call up the "Help & Support" number for your system. I think that they recommend you to sent it in.
**How to lessen the chance of getting the "Red Ring Virus"**
-Keep your system on a hard surface! (desk, counter top, etc.)
-Do NOT leave the system on for an excessive amount of time! (like a week straight)
-Try to provide some support for the system so there is better circulation. (bottle caps, blocks, books, etc.)
-NEVER BLOCK THE AIR VENT!! THAT IS ONE OF THE MOST COMMON CAUSES OF HARDWARE FAILURE!!
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(Basically, keep your system as cool as you can. I had a laptop and always had it on my carpet, and it could not get the air it needed, so the hard drive burnt out. So I had to replace the hard drive and reinstall everything.)