Gabb, I don't think the Xtreme Music version is stripped down. In fact, I think the Xtreme Music costs more than the Xtreme Gamer, or at least it did a year ago. I have the Xtreme Music, and it does game mode, entertainment mode, and audio creation mode. Imo, unless you are playing a game that directly supports an X-Fi in game mode, like BF2, I just run Entertainment mode when I game, and never get any problems. The overall quality is more clear and my speakers seem more active in sound production.
Some people do use onboard and sound cards at the same time. I use the X-Fi for all of my sound playback, like games music ect. But I have my headset plugged into my audio ports for my mobo, and run onboard for ventrilo and teamspeak. I don't like people's voices coming out of my actual speakers when I game anyway. I'd rather have them come out of the headphones on my headset.