i see no reason why the x360 wheel wouldn't work using the wireless gaming adaptor that is required for the regular wireless xbox controller to work in windows. that said, i haven't tried it.
and as for forza 2 cars being on rails, they absolutely are not. the unmodified cars handle like they should, and when you apply suspension and aero mods, then they handle better (if they are tuned correctly).
i do agree that forza 2 is more "arcady" than lfs, but only slightly more so, and that feel is greatly reduced when using the wheels and pedals, to which the same could be said for those racing in LFS with gamepads/keyboard.
regardless of what car you are using, you have to use proper driving techniques to achieve fast times. basically, you have to drive like you do in LFS, and if you try driving like you do in GT4, then you will not make the turn.
you are very much entitled to your opinion, but when you spout off about what you know nothing about, you just lose credibility.
i hope that you don't take that as a personal attack, because it is not meant as such.