KOOLER: By everyone, you mean that the non-XenServer backup vendors that are HOS level backup can do this?
Any vendor who can backup physical virtual machine can do agent-based VM backup. But "Xen" means "ISP" and means "hundreds of VMs". Any agent-based backup is PITA for this condition.
Xen might rule in that space but it is used broadly in really small environments too. There is no direct connection between Xen and big deployments. Very popular for small ones wanting to avoid the limitations of HyperV and the costs of vSphere.