It's not xcopy deployment, it is not even ycopy deployment, it is zcopy deployment!
Imagine deploying your website by just uploading a single ZIP file containing all of your website files, cool ugh?
This is really easy to achieve using the ASP.Net 2.0 bits, take a look at my new article @ MSDN:
Of course, it is just a sample and there are lots of 'details' (i.e. security) left behind, but nothing should stop you from coding that yourself :-)
Or better yet... lobby to have something similar already built-in for Orcas... (now that would be cool...)
Ok, enough of auto-plugging for now...
PS. the article & code are based on a presentation on the same topic I did in VSLive! Boston last year.