This article was written prior to .NET release and explains the option awailable then.

But a very strong point I noticed is the speed of data exchange. XML may be slower than sending a cursor (.DBF) as a disconnected recordset. The reason being: -
1) it incurs overhead of conversion to a recordset on server as well as the client.
2) it is bloated because of the tags all over the XML.

So if you develop Server & Client side components yourself & don't need interoperatability with other applications then you could avoid using XML.

Thanks for the info.!