The following is my opinion - as a flight-sim fan AND as an experienced (though out of work) computer game developer:
For me, the trade-offs are as follows:
1) MS-Flight Sim is a much more "polished" product - its formally developed by a dedicated team. X-Plane is more of a "darkhorse" development - by 1 full-time programmer and a few contributing coders & artists. This doesn't mean that X-Plane or Laminar Research put out an inferior product - but for compatibility, polished terrain graphics, etc. I'd bet Flight-Sim will always have a slight edge. X-Plane will always be somewhat "in development" - with new features being added and put out before they (or older features) are completely polished and matured. Over time, I believe that keeping X-Plane cross-platform between Windows & Mac will become a bigger headache, though... MS is furthering DirectX, but OpenGL is somewhat stagnant and has always suffered more driver/compatibility problems - it remains to be seen whether graphics-card manufacturers will still be supporting it for consumer products in 5 - 10 years.
2) Flight-Sim is a "mass-market" product. It therefore will probably enjoy greater support from real, commercial airplane manufacturers and the aerospace industry. X-Plane has been customized for clients like Scaled Composites and others; but as far as putting "name-brand" planes in the latest version of the program, Flight-Sim will always be able to tout huge numbers of planes "right out of the box". However, this "mass-market" attitude means that some of the more technical and less-fun aspects of flight may NEVER be included or modelled in MS Flight-Sim. X-Plane's "grass roots" mod community seems to be able to field a huge number of user-built planes, too - but the quality is always a bit suspect without thorough professional testing.
3) As a counter-point to #2, X-Plane is a highly-targetted product. Its entire goal is to simulate (roughly) the physics of something flying through the air. LOTS of parts of the product are "hacked in" and don't follow proper physics (land inverted or ground-loop a plane and watch your wheels go crazy, for a good example)... But the actual physical flight modelling is pretty darned excellent. The application of physics to flying bodies and the fairly-accurate accounting for density / altitude, temp., wind, etc. make the "core" of X-Plane fairly technically advanced. Do NOT confuse good flight physics with a godly programmer, though! While I give Austin Myers a great deal of credit for his software, his recent news update about "vectors & objects" cover VERY BASIC modern programming practices; and the fact that he is just now making use of them was rather shocking to me (but then I'm frustrated because people keep knocking be for being more of a web-programmer than a "real" programmer)... I have found plenty of subtle errors in X-Plane; but for a very small company, the product is extremely good. Austin certainly has a tenacity and determination that I couldn't possibly match - the product has probably consumed at least 10,000 to 20,000 hours of his life.
Bottom line for me is: If you care about the in-flight handling of your aircraft - and aren't necessarily interested in an accurate representation of your home-town's buildings from the air - X-Plane is the way to go. Its small-team roots are a double-edged sword, providing a slightly less-polished product; but with a tighter focus and the agility to fix or add to the product quickly. If you want the flashiest graphics and product support; as well as a more casual flight experience, then MS Flight-Sim is the way to go. I have a feeling that the former of the two is more appropriate for the folks here. ;-)
Take care,
--Noel
