I think MS wants to turn some profit this gen compared to last gen. I also think the only reason the original XBox lasted four years because they were losing money no matter what. Upwards of $100+ per console even when it was killed? The 360 is already at the point of being profitable as we speak as far as I know, except for maybe the Arcade unit. I can see the 360 having a six year life span before they even put out the 720. MS can also drop the console to $130 or less within the next two years, giving them their own version of a PS2 in terms of cost and game lineup.
Also the 720 will be atleast backwards with XBLA titles. Could you imagine all the pissed people (myself included) if XBLA titles weren't backwards? 360 games on other hand is a toss up.
It's just that simple.
