As has been long reported, Microsoft's Xbox development system are PowerMac G5s. (photo)
Indeed, Xbox 360 demos being shown by Microsoft are running on PowerMac G5s.
"We purchased a number of Apple G5's because very specific hardware components of the G5 allow developers to emulate some of the technology behind future Xbox products and services," a Microsoft spokesperson said in a statement. "This is an interim development tool that will be replaced with a more powerful and comprehensive solution later."
Both the PowerMac and Xbox sport PowerPC-based processors from IBM.