1) XML is still used. AJAX and RSS are real-world examples of XML in use. XML can also used as flat-file databases.

2) On a personal note, I was a big fan of the XHTML syntax because it was semantically correct (in terms of a tag-based language, anyway). But, now, I don't really care too much either way. I've moved away from it and gone with HTML5--even though I don't use many of its features, it's simply the new direction of the web. HTML5 can be written in the XHTML or traditional HTML syntax if you still prefer one way or the other.