This is some soap opera shit.
I think the issue with a pirate on the leaderboard is that they have an unfair advantage and shouldn't be allowed to compete with others who, as far as we know, all obtain their games legally; he has access to any game that happens to get uploaded to the internet, and it would be no stretch of the imagination to think they wouldn't hesitate to grab a game save along with their .iso that isn't their own 'just because.' (As mentioned earlier, obtaining online-only achievements offline--without a time stamp--is a rather blatant red flag.)
Meanwhile, everybody else has a limit; I doubt anybody here could rationally just buy out a store or order an entire collection of every 360 game without something short of winning the lottery or receiving an inheritance. However, with a couple weeks worth of downloading and any pirate could essentially do exactly that. (I'm not suggesting that our resident pirate has done anything that severe, this is merely hyperbole.)
Justifying piracy is totally beside the point here; we don't need a debate about morality or the consequences of illegal copies, but I do think it's rather silly to flaunt it as if it's a badge of honor and then protest when you're not allowed to compete on a leaderboard such as this. I think I may be speaking on behalf of most people when I say allowing a pirate or game-saver on the leaderboard would only serve to further trivialize it. The leaderboards are already somewhat trivial because not everybody has the same financial capacity or amount of time to play. It's never been an equal playing field. But, allowing somebody with such a glaring advantage to compete would likely destroy their motivation to compete for those around him and ultimately cheapen it for everybody.
It's important that we don't turn this into a witch hunt, however. If it gets to the point where we need to start scanning receipts and NEVER go offline to prove our honesty, we've done something wrong. But when somebody admits to piracy, there should be no discussion necessary as to whether or not they should be allowed on the list.