^^ The Cell's SPEs can perform many functions similar to GPUs, but they aren't GPUs. Anyone who has ever written a software rendering engine would concur that the SPEs downright phenominal, and supremely flexible, for such an endeavor -- but they aren't going to replace a dedicated GPU when it comes right down it it. They can assist the RSX by relieving it of some work, realistically. "Preprocessing" some graphics tasks, if you will.
That being said, in terms of real-world performance, the Cell is a little more powerful than the Xenon, but the 360's GPU usually typically makes up for the difference, unless the engine is a dedicated PS3 one, because not many games are CPU-bound, they are GPU-bound.
I think the issue most people fail to understand, regarding the Cell, is that the Cell itself is not some magical phenominon that is going to change the landscape of computation -- the idea* behind the Cell is, however. Future iterations of the same concept will outperform "full" multicore architectures, from a heat perspective, from a transitor count/cost perspective, and every other perspective that matters, except a software development perspective.
And that last bit is where architecture's like the Xenon get their praise from. In the hurried modern world, where time and budget is always in a concern, the Xenon has a fair sized advantage, and that's not to be underestimated.
* The idea is that "convenience" features of a processor, like a huge cache, out-of-order execution, full memory access, and a good branch predictor, are much more expensive, and much less worthwhile, than the extra basic cores you could put on a chip are, with the same transitor count. More power, less heat, less raw materials. The added performance comes at a cost to the software developer, who can no longer rely on the aforementioned crutches to allow his/her code to pass for "fast".
Yes, even the Cell, the first such processor, kicks the Xenon's ass... in the hands of a badass programmer. The Xenon rules all in the hands of a newb <-- which describes a LOT of game programmers.