It's worth checking out that official website. I notice they will also permit the use of Torque X in their competition.When Microsoft launched the XNA program last year, it was widely assumed that user-created content would end up on the Xbox Live Arcade. Microsoft has confirmed today via a press release that Schizoid, a co-op action game "in which teamwork matters like never before" will be the first Xbox Live Arcade title built using XNA Game Studio Express.
Microsoft has also launched a competition for game developers to, "create visions in a world where they make the rules, shape the characters and create the evolution of the story". The competition, titled Dream-Build-Play, is a global contest which encourages entrants to create their own Xbox Live Arcade title using the XNA Game Studio Express tools. The competition is open to any user of XNA Game Studio Express and is open until July 2nd. Winners will be announced on August 13th at the Microsoft Gamefest in Seattle.
The company is offering a US$10,000 grand prize, and the opportunity for the winner's game to be published on the Xbox Live Arcade. More than twenty winners will be selected to win prizes worth a total of more than US$40,000. More information on the competition can be found at the official website.
Although the XNA Creator's Club might seem a pain in the arse for casual hobbiest types, it's not completely necessary just to get a feel for it all - you can still fiddle with XNA Game Studio Express without needing all that. If you only want to play with other people's creations then it's a waste I guess, but hopefully most of the cream will rise to the XBLA top.
For the small but semi-professional developers it looks like a good and cheap opportunity to potentially reach a very large and lucrative market, and the comparative ease of writing managed code might mean we see some interesting ideas for XBLA in the future...