When IBM did this sort of thing, it was called FUD. In this case, I think it's just an MS marketing guy with no grasp of technology speaking out of his... well, just imagine the orifice he's using. In a CNET article discussing JavaScript and DHTML (now called AJAX, because we needed a new acronym), Charles Fitzgerald says:

The software giant, which pioneered several of the technologies developers are now re-evaluating, dismissed any threat to its plans for XAML. "It's a little depressing that developers are just now wrapping their heads around these things we shipped in the late 20th century," said Charles Fitzgerald, Microsoft's general manager for platform technologies. "But XAML is in a whole other class. This other stuff is very kludgy, very hard to debug. We've seen some pretty impressive hacks, but if you look at what XAML starts to solve, it's a major, major step up."

Yes, a UI description language is a real step up from something completely different. Maybe someone can get Fitzgerald an Apple and an Orange, and see what happens.