Thanks for those last two replies, i didn't know it was normal for the heavy processing to be done all on the server. I like the idea of being able to use everyone's resources, but i suppose there really is no point when the servers can have enough resources to do it all.

I would not assume that there's "lots of unused resources" among players of your game :-)

Heavy processing is ALSO done on the clients. It makes no sense to waste bandwidth sending the exact movement of every link in a 200-link tank tread over the wire. Instead, each client that sees the tank roll, will run its own physics simulation, where the links will move up and down depending on how many rocks/dolls/skulls-of-the-crushed-enemy are underneath. Additionally, the clients all have to work hard to produce all those nice graphics. It turns out that graphics is actually just as much a CPU limited problem as physics is these days -- feeding a modern graphics card with enough data to generate the scene is often harder than the actual rendering of that data.

Their architecture doesn't use a centralized server[/quote]

For all intents and purposes, the gameplay is client/server, not peer-to-peer fully-connected (or partially-connected.) The design of messaging and authority is the same as you'd make with a centralized server, and is, in this regard, the same as any other FPS or other user-hosted game back to the beginning of time.

On the Xbox, you don't have to worry as much about user cheating, though, because Microsoft will ban any boxes they detect have been hacking. Typically, right before the next big game is released :-)