I can't help but wonder how flexible this will be and how fast (or slow) it will be.
I mentioned slow because .NET was mentioned in the article,... .Net...games...?...eww :p
And after having seen the system requirements for Vista, I'm afraid to find out the requirements for this one.
i think dotnet is especially good for building games, the execution of code is at 50% to 90% of c++ code and with cpu's getting faster each month, i think developing in c# can only bring more complex games faster to the market. i read that managed direct x is running at about 90% of unmanaged direct x, so there is not much there to worry about either.
of course if you look at the average dotnet code (written without understanding) it is many times slower then optimized c++ code, but just doing some simple things like checking what you're about to do instead of wring that try/catch can improve speed factors to over a 1000 times (yes i tested this to convice my coworkers to program differently)
one thing is for sure, to port my pacman to xbox i would choose C# over C++ any day of the week
then a lil about visa: in vista the UI is made with game technology, this adds a lot of extra to the specs. yet if you compare what you need for vista to any modern game console specs, then visa isn't doing bad at all.