My buddy was a victim of a DoS attack, I have evidence that heavily insinuates the user was...

You should report the player. Follow these steps if you don't know how to : https://support.xbox.com/my-account/xbox-live-membership/file-player-complaint

Report the player via your console & the enforcement team will investigate & take the appropriate action.

As ddos attacks are done via your broadband/internet & not xbox live you would need to contact your isp.

Details on how to deal with ddos attacks can be found HERE

It's best not to invite random people to party chat as that's how they can find your ip address & launch a ddos attack.

you will need to tell your local authority as it is a criminal offence to ddos someone.

This would've happened whether it was me or someone completely different. People like this are toxic and prey upon the system of "Report and block." There always gonna be another victim for them. I realize that this issue is mostly with an ISP. But the user
is clearly breaking the ToS with issuing an attack. And the threats of "ill keep him offline" are well within harrassment.

Ive submitted a report against the player. Its just seems like a game of kick the can, where the next vocal victim will also be told to block and report.

So, if the situation is exactly as your describing it, then yes, it's against XBox's code of conduct among other agreements.

But reporting them via the link the other ambassador put up or via the report option in Xbox Messenger is the way that it gets reviewed and, if appropriate, consequences would be applied.

And to be clear, I'm not doubting what you're saying- I'm just one of those "Innocent until proven guilty" when I talk sort of people ;-)

So- report it and let it go is my advice. There isn't anything else you can do past that because if you've done that, you've put it in the hands of the right folks.