I believe there are quite a few commercial applications that make heavy use of XML as a storage medium. I've done it for a project planning application, where the user stores each project in it's own file. The app lives on a USB stick, and requires zero install. All the data is pulled from the XML and worked on in memory, so getRecord(id) is nuts fast.
So my answer would be.. when the data is small enough to be held in memory, a database is over kill.
