I was under the impression that most games don't run on XP, which is why I was confused as to his usage of the OS. Then again, I could be entirely wrong about that seeing as how I don't really play very many PC games.
XP completely eliminated older Windows' utilization of MS-DOS (2000 did also, but 2000 was an NT format, you don't run games on NT machines). Most older games will not run on XP.
XP Home or XP Pro, it didn't matter. Also, XP changed the way some things run (no specifics there), so some new(er) games require you to run it in a compatibility mode that simulates certain aspects of older versions of Windows.
The main difference between XP Pro and Home that I noticed anyway was that XP Pro had more networking ability.