Yes, I remember it took a few moments for them to crack the PS2, but when they did you needed a modchip. Dreamcast was cracked from Day 1 because the GDROM is essentially a CDROM with 1GB of data, so all the modders did was to remove some files from the GDROM and burn it to a 700Mb CD. Crazy thing is, most Dreamcast games were not over 700Mb......so it was a breeze for pirates.
The funny thing is, one of the reasons why Sega went for the extra capacity was to offset the traditional CD-ROM specs and thus prevent piracy, well that didn't work out. Also, we can see that Sega and MS were close way back then too and Moore was instrumental. The Dreamcast used a tweaked Windows CE for it's OS, so I imagine it was much easier for pirates to circumvent any level of security there was, if any, through a windows PC......Truth be told, Dreamcast was a piraters' 101 class session. You remember bleemcast? Dreamcast was pretty much open season.