So you are basically just wishing that all this stuff will work because Microsoft told us so, and you can't really explain how Microsoft wants to overcome all the economical and technological absurdities of this concept?
Er, no, that's not at all what I'm saying.
First, I don't think the concept itself is a "technological absurdity". There are things that can obviously be done (high latency, high processing of small data). Others that obviously cannot (low latency of heavy data). And many other things that we don't know. Based on that, I have no reason to doubt that MS is really trying to do some remote computing when they say so. And if they do, it is only expected that they develop specific tools for that.
Second, the economical part is obviously something important that we haven't discussed yet. Someone has obviously to pay for those features, but I would also think that MS has thought that through, since hosting and selling cloud servers is a big part of their activity, and something on which they intend to expand.
There are too many unknowns there to speculate on the price of that (we don't even know what kind of tasks will be running on the servers, and how much data/resources they require). Maybe they'll have the publishers pay. Maybe they made a deal with them in exchange of other benefits. Maybe cloud features will be in a XBL Platinum package. Who knows ?
They are lying to you. They are sugarcoating their performance deficit. They are literally providing nothing that anyone couldn't have done years ago. Cloud-IaaS has been arround for years. Architecture and communication patterns for distributed systems have been arround for decades. If there would be any sense in this, somebody would have already done it. But nobody has done something even remotly similar to partially offloading game calculations. I am not even aware of any research paper outlining something like this. Because its BS. It does not work. It has a ridicolous ratio between benefit and complexity/costs. And Microsoft won't pull any magic out of their buttocks to suddenly make it a rational thing.
Your speech reminds me of one I had not too long ago. After 6 years experience working in computer vision at the time, I wouldn't believe the rumor that MS would build and sell a low cost depth camera, and do real time full body tracking for gaming applications. Decent depth cameras were as expensive as cars at the time, and there was no published tracking algorithm that could do what was required, especially on the specs of a X360. I did call that bullshit, and economically/technologically absurd. And I was wrong.