The Inquirer is reporting today that MS told them at the ECTS show in London that there are plans to allow PC games and Xbox games to share codebases. The Inquirer describes this as a "shift from its past strategy".
In the past, the portability of games from Windows to the Xbox was touted as a strength of the platform. However, the change of processor architecture in the Xbox 2, from x86 to PPC, calls into question how easy it will be to share code in the future between games on the two platforms.