At the end of the day, why choose XHTML over HTML?
For the visitor of a website it probably doesn't make any visible difference. Furthermore, XHTML is usually more of a pain to use as at least one widespread browser still doesn't know how to handle it and you need to serve it as text/html in that case (which yields invalid HTML).
If your HTML is going to be regularly processed by automated tools instead of being read by humans, then you might want to use XHTML because of its more strict structure and being XML it's more easy to parse (from an application standpoint. Not that XML is inherently easy to parse, though).
Apart from that I don't see any compelling reasons to use it, though. XHTML was created in an approach of making use of XML features for HTML and basically it boils down to "HTML 4 with several annoying side-effects" (IMHO, at least).
You should read Beware of XHTML, which is an informative article that warns about some of the pitfalls of XHTML over HTML.
I was pretty gung-ho about XHTML until I read it, but it does make several valid points. Including the following bit;
XHTML 1.x is not “future-compatible”. XHTML 2, currently in the drafting stages, is not backwards-compatible with XHTML 1.x. XHTML 2 will have lots of major changes to the way documents are written and structured, and even if you already have your site written in XHTML 1.1, a complete site rewrite will usually be necessary in order to convert it to proper XHTML 2. A simple XSL transformation will not be sufficient in most cases, because some semantics won't translate properly.
HTML 4.01 is actually more future-compatible. A valid HTML 4.01 document written to modern support levels will be valid HTML 5, and HTML 5 is where the majority of attention is from browser developers and the W3C.
Future compatibility can be huge when working on some projects. The article goes on to make several other good points, but I think that may have stood out the most for me.
Don't mistake the article for a rant against XHTML, the author does talk about the good points of XHTML, but it is good to be aware of the shortcomings before you dive in.
I was going to add this as a comment to one of the other posts, but it grew a little too large.
What the fundamental point that most people seem to be missing, is the purpose behind XHTML. One of the major reasons for developing the XHTML specification was to de-emphasise presentation-related tags in the markup, and to defer presentation to CSS. Whilst this separation can be achieved with plain HTML, this behaviour isn't promoted by the specifcation.
Separating meta-markup and presentation is a vital part of developing for the 'programmable web', and will not only improve SEO, and access for screen readers/text browsers, but will also lead towards your website being more easily analysable by those wishing to access it programmatically (in many simple cases, this can negate the need for developing a specific API, or even just allow for client-side scripts to do things like, identify phone numbers readily). If your web-page conforms to the XHTML specification, it can easily be traversed using XML-related tools, and things such as XPath... which is fantastic news for those who want to extract particular information from your website.
XHTML was not developed for use by itself, but by use with a variety of other technologies. It relies heavily on the use of CSS for presentation, and places a foundation for things like Microformats (whether you love them, or hate them) to offer a standardised markup for common data presentation.
Don't be fooled by the crowd who think that XHTML is insignificant, and is just overly restrictive and pointless... it was created with a purpose that 95% of the world seems to ignore/not know about.
By all means use HTML, but use it for what it's good for, and take the same approach when looking at XHTML.
With regard to parsing speed, I imagine there would be very little difference in the parsing of the actual documents between XHTML and HTML. The trade-off will come purely in how you describe the document using the available markup. XHTML tags tend to be longer, due to required attributes, proper closing, etc. but will forego the need for any presentational markup in the document itself. With that being the case, I think you're talking about comparing one type of apple, with a very slightly different type of apple... they're different, but it's unlikely to be of any consequence (in terms of parsing and rendering) when all you want is a healthy, tasty apple.