I think that ESRI made a huge jump in the last 3 years from the ArcIms Server (and the weird AXLs files) toward using almost the same API above the MXD files and Arc-Objects architecture.
Don't get me wrong they still have a lot to do, but hey they are doing it in the right direction.

I wanna show something that never happened before:
Next version (9.3) in brief
Microsoft API & ESRI GIS
More on the next version
and here is the real article about the next releases.

Some Highlight for the 9.3:

• Windows vista capabilities
• Working with Microsoft about adding virtual earth controls to the API.
• When? a the first quarter of 2008! (good to know)

Something still missing:

• Readability and Usability testing the Arc-Objects API.
• WPF support, I've read about OpenGL API... in the next releases.
     

ESRI letting us know about the next releases, they still don't let us know everything but it is a something we should use.
Moreover, they even made a good direction while working with Microsoft.