XML helps because it a) Lets you to describe structures b) Make a clear context-change which make it clear you are not "talking in XML" you are "talking about XML".

I assume you are right too, JSON is a less verbose format which allows you to express any structure you can express in XML, and should be as easy for AI to parse. Although that probably depends on the training data too.

I recently asked AI why .md files are so prevalent with agentic AI and the answer is ... because .md files also express structure, like headers and lists.

Again, depends on what the AI has been trained on.

I would go with JSON, or some version of it which would also allow comments.