It seems that someone's beaten me to releasing the first point & click adventure game on the Xbox Live Community Games channel. I've just had a quick go of Writer's Block and the similarities and differences between it and anything XAGE produces are interesting (to me, at least).
Both have SCUMM-esque interfaces, though WB toggles the GUI with a click of the left shoulder button whereas XAGE always displays it at the bottom of the screen (as per the LucasArts games). Early on in development I played around with various ideas for the interface similar to what the guys behind WB have gone for. In the end I settled on sticking as closely to the winning (Lucasarts) formula as possible, as it turned out that using the thumbstick for the cursor wasn't nearly as laborious as I thought it might be. In future, if there's a demand for it, there's nothing to stop me adding functionality for a Sierra style interface. It's purely because I much prefer the SCUMM system that XAGE uses it.
I quite like Writer's Block, and seeing a complete adventure game at a high resolution on a tv screen is refreshing. There are a few things in it that I'd have done differently - the dialogue system in particular is a little clunky, and the character graphics, whilst pretty decent, suffer from that 'beanpole' style that seems to curse most AGS games. I don't regard WB as competition as such as any game that brings more attention to the genre can only be a good thing.