Before I give any tips, I want to address some confusions that players might have:
First, this achievement (Living Legends) can only be unlocked in "LOCAL" expert co-op. Do not do it on Xbox Live because you will not unlock it.
Second, both players must 5 star every single song in expert co-op, not just the main set list. I do not mean the bonus songs where you must press another button to reveal the songs. I'm referring to the songs that are unlocked once you and your partner have completed co-op career.
Third, the multiplier and score do not always determine whether you will get a 5 star. Getting a 2.8x means a 5 star in single player but not co-op. I have got 3.4x with a co-op partner in "Helicopter" and got 4 stars. From personal experience, both players must play equally well to achieve a 5 star.
Fourth, only player 1 will receive this achievement. That means there will need to be two playthroughs if both players want this achievement.
Lastly, both players must be on expert. One cannot be on easy and another on expert as this will only unlock the easy co-op achievement.
(1) Optimal Star Path - Anyone who has played this game knows that star power makes a big difference. Unfortunately, star power does not make up for inconsistent play. I have intelligently used star power but still have got 4 stars because my partner could not play well. Anyone aiming for this is obviously good enough to know when the best parts are to activate star power.
(2) Hyperspeed - Most people will find three to be too fast in co-op, but one or two is what I recommend. The separation in notes can be helpful for most, but make sure that your partner is comfortable with hyperspeed.
(3) Streaks - This is more important than star power and hyperspeed. If you or your partner do not streak consistently then you won't get a 5 star. From personal experience, I have found that streaking is more important. I have got 3.2x on Knights of Cydonia before but I still did not 5 star it with my partner because he fudged up a lot. This was using an optimal star path, by the way.
(4) Practice - More often then not, your partner will be the one who is going to be lagging behind. Even if that is not the case, both players must practice sections that ruin a 5-star run. For example, my brother had to practice the strumming speed two or three times on Raining Blood and we did it on our second try. Practice always will help.
(5) Good Cooperative Partner - This is more important than any thing else. If your partner sucks then you will not get this achievement. :P
Good luck and have fun!