Blimey! I didn't expect this much activity on this post. Thanks one and all for your contributions!.
Owen/Jeff,
I quite agree, XML is a great method for passing around structured data.
By way of adding to the debate (and not because I agree with it) I'll point anyone reading this to Don Peterson's diatribe about XML from back in 2003 "Is XML the answer" (http://www.sqlservercentral.com/articles/Miscellaneous/isxmltheanswer/1147/) - a good, reasoned article. We can of course argue about its relevance given its age but nonetheless, worth a read I think!
-Jamie