As a good rule of thumb, I design my XML and relational databases this way:
If I need to search data or aggregate it (perform computations across multiple records like sums or averages), I store it in a relational database. That's what relational databases are best at.
If I need to transform information into a different format for display purposes (to support both HTML and wireless devices, for example) or I need to transmit information across the Internet (to a business partner, perhaps) then I use XML. Those are two of the things that XML is good at.
Senior System Architect, Equient Corporation
author of: Professional XML Databases