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kirby007 said:

how will devs cope with that? will xbox users get the options for 2 different performance setting or will they be lazy? how will this effect level/map size!? the power difference between launch games and end of lifecycle games will be bigger then now! Will microsoft invest more to keep up with computer developments?!

there are still some question marks, but i'm not worried because microsoft initial plans were brilliant!

No, there aren't any questions.  This was answered a long time ago.

Basically, the game adjusts based on whether or not there is an Internet connection available.  If there is an internet connection, the game will be able to take advantage of Cloud features.  You as a gamer shouldn't have to do anything.  If there isn't an Internet connection the game defaults to it's standard set of features. 

Yes, some games will offer a better experience to those connected to the cloud.  Forza 5 is a great example.  Even if you never play the multiplayer portion of the game, in single player you can take advantage of racing against your friends using their Drivatars.  Other games may have other features that aren't available, such as an extended draw distance, more sophisticated AI, or world persistence.  It isn't to say that a game is depreciated, it just means that the experience with an online connection will be better.  Fable II, a non-cloud based game, featured persistence.  It just had to figure everything before the game actually started and it was limited in that persistence.