XHTML is a stricter form of HTML and as such is a subset of XML which is an extremely useful, powerful and very strict way of marking up pure data.

The headers you sometimes see along with XHTML code declare what exactly the rules are.. for instance, that <a> is an anchor. In XML you can declare your own rules.

XHTML is significantly better than HTML, as it encourages good practice. Where it doesn't allow things that HTML does, it's likely there's a good reason.. for instance not using target="_blank". These things then in turn impact on the sites accessibility, consistency, search engine performance etc etc.