I recently spoke to a customer who wants everything to be XML so that they can re-use it. Regarding this rationale, it seems like the old proverb, "For someone who has a hammer, everything looks like a nail." So, I figure someone at that company knows XML (and they are the only person who knows it, therefore they want job security), and they want to require everything to be in a format they (and only they) can re-exploit. The purpose of XML is precisely to get away from this single format-based mentality. But some people are using XML to enforce a single format requirement.
From a technical perspective, yes, ReadyGo can produce output in XHTML that validates. The only reason ReadyGo decided to support XHTML is that Firefox 3.5 now supports MathML - so there is a compelling reason for XHTML. Before MathML was available, I could not find a good reason to produce XHTML (or XML) other than to satisfy the narrow requirement that "it must be XML".
I guess my rant is on IT departments that create requirements that meet no business or technical needs.