Yes, it was a requirement that XHTML 2.0 documents be served as application/xhtml+xml (which IE didn't support at the time), but that was really a non-issue (with so much renamed and moved around v. HTML 4.01 and its XML reformulations (XHTML 1.0, XHTML 1.1) because there was no graceful fallback story.
The bigger problem was that it required content to be served as application/xhtml+xml, and gave the same element and attribute names, in the same namespace, different semantics to what XHTML 1.0/XHTML5 gave them, with different implementation requirements (and it being impossible to satisfy both).
AFAIK this essentially got resolved by XHTML 2.0 being abandoned (in 2009, years after HTML 5 had moved to being jointly developed with the W3C).
Yes, it was a requirement that XHTML 2.0 documents be served as application/xhtml+xml (which IE didn't support at the time), but that was really a non-issue (with so much renamed and moved around v. HTML 4.01 and its XML reformulations (XHTML 1.0, XHTML 1.1) because there was no graceful fallback story.
The bigger problem was that it required content to be served as application/xhtml+xml, and gave the same element and attribute names, in the same namespace, different semantics to what XHTML 1.0/XHTML5 gave them, with different implementation requirements (and it being impossible to satisfy both).
AFAIK this essentially got resolved by XHTML 2.0 being abandoned (in 2009, years after HTML 5 had moved to being jointly developed with the W3C).