Those "this is realtime" videos are utter BS. Of course, that's possible if you don't have a game running at the same time, but nobody will make a game that demands a top-end graphics card or put that much effort into something.
I'd say XNA is stupid, all it does is make porting between PC and XB easier. However, the XB isn't the dominant console, so you're better off with solutions like Renderware, which support ALL consoles and the PC (or SDL, which supports almost any kind of computer and is used in games like Unreal Tournament 2004). I've heard of comparisons to .NET, which is pretty accurate.