Having never played Minecraft for more than a few crappy, performance-killing moments on my PC, I am thoroughly enjoying this game on XBLA. I fired up a new world last night, and 9 hours later I was still happily tapping away at hundreds of quantities of cobblestone from a gigantic, floating mountain.
I suppose it must be the case that those who played it on PC may find the world to be small, but against its platform competition, Minecraft 360 features a larger, more interesting world than its clones, especially across the horizontal dimension, discounting Total Miner's 2000+ block depth, which, while impressive, is a far more static and empty world than Minecraft's, and much, much smaller across the horizontal dimension, capping out at 500 blocks across in Dig Deep IIRC.
If you've never played Minecraft, don't be dissuaded by the PC players claims of a "tiny" world. Having dumped over 12 hours into my first world already, and only revealed about 50% of the surface map in the process, there's more than enough content without needing to wander for 20 minutes in one direction for no reason except to just do it. For people who have never played it, I imagine an endless world won't be missed like it would for others. Though, hopefully a creative mode with a larger plane is in the pipeline, I can understand how that would be desirable.
Seed functionality is there, so seeds that worked on beta Minecraft PC still work, so that's a small plus. I spent a few testing them out last night, and they work great. Gives a lot of landscape variation depending on what you use, and how.
At any rate, for someone who's been desperate to play Minecraft, tried the clones, and found them fun, but missing something, Minecraft 360 is an excellent choice. At $20, it faces stiff competition from a couple of the $2 Indie Clones, so it will be interesting to see if these games develop a sort of feature arms race, or if the good clones will stifle out now that the big daddy of them all is in the picture. It remains to be seen.
tl;dr: Minecraft 360 is an excellent version of Minecraft, and will suck up hours of your life, especially if trying the PC version as anything greater than a foggy postage stamp has been denied to you, as it has been me.