Programming native code in C++ is already available on the Xbox 360. Our team doesn't have to do anything at all to enable that. In fact, the XNA Game Launcher is written in C++!

The catch is that you need to be an approved Xbox 360 developer and have a dev kit to use it. XNA Game Studio Express is not aimed at that audience. We already have a great SDK for the Xbox 360 aimed at professional developers using C++. That isn't what XNA Game Studio Express is about.

With C++ and native code, the security of the system is actually not an issue. Allowing people to run native code would be no more insecure than managed code. On the Xbox 360, we do not rely on code access security (CAS) to do anything. CAS doesn't even exist on the Xbox 360 NetCF! All your managed code runs as if it were fully-trusted, and you are allowed to use unsafe code.

A big problem with native code is the lack of interop support on the Xbox 360. That, and we are trying to convince the industry that you don't need to use native code to create great games with good performance.