XNA is awesome, especially now that they release 2.0 with networking and live connections. Few months ago after uberworld I did my own MMO engine in C#/XNA/SQL, and it's working pretty well. I had no background on massively multiplayer framework but did have knowledge on networking.
Cloud if you want to make a mmo framework you should consider SQL5 (or any database!) for backups, cpu speed, multiple parallel access of data, rollbacks, object oriented databases, persistancy, etc. Interfacing SQL with C# is easy! Although It will not work on XBOX360
For a classic game, even if it's in lan, i'd recommand XML files, there is a really cool library to handle them in XNA. However there must be some special way to handle saves if you want your game to be X360 compliant (choosing cardrige or hard drive, which xbox account, etc. all this must be provided in XNA, haven't looked!)
Myself I wouldn't advice to make a 360 game, it just gives too much hassle, first have it work on PC, and then if it's fun and you really want it done on XBOX then just do it
Just my 2cp!
Hake.