I'm not that certain about that at all. The only similarities we've seen between this and Xenoblade in terms of world concept are the same similarities we see with Xenogears and Xenosaga - high tech cities, normal cities, giant robots, weird biomonsters.
The Japanese Nintendo site still clearly lists the game as "Brand New Title from Monolithsoft" so they're probably still deciding on the title. Iwata also specifically says the team is taking the experience they learned from Xenoblade and applying it to this new game. It's clear Nintendo is keen to make the connection that this is the successor to Xenoblade on the WiiU, but if the story is connected I think they would just come out and say it. Feels more likely that Monolithsoft wants to make a brand new world, and Nintendo wants to make sure people know it's going to be "like Xenoblade".
Hmm. Maybe you're right.
Shulk in the reveal trailer still gives me pause.