V1 gamertag a gamertag created on original Xbox live.
A reset is when the account is deleted and the gamertag associated with the account is put into limbo where it waits to be recycled back into the system for other Xbox live users to change their names to.
An account may be deleted after 7 years of inactivity but I have heard if there are credit cards linked to some v1 gamertags then the accounts won't be deleted thus the gamertag won't be reset.