Well considering xbox mame doesn't have enough memory/processor power to run the newer games and the ps2 has roughly 3/4 of the system specs and lacks a harddrive for cacheing I would say not so well. 
The problem was mainly memory issues, as the emu exe is pretty big plus mame try to loads the roms in ram so 64MB is an issue of course... So after splitting the exe in smaller sub-exe they were stuck.
But you should check the latest release, they managed create a "virtual memory" to allow uncompression of the rom on HD instead of RAM...
MAME on XBOX is working really great now... even with newest games like CPS2 and Neogeo
Just to let you know...