There was a long thread about this on the forza forum quite some time ago. People have been complaining and everybody wanted to know why it is not possible to use a DFP or a G25 with the xbox.
The final verdict, if i remember correct, was that the xbox isn't capable of simulating real force feedback. The MS wheel is basically just a controller with rumble. It uses the exact same "information" from the console that is "sent" to the gamepad, and "simulates" force feedback with it... while it really just is rumble.
That's why a G25 won't work, and never will... not because they wouldn't want you to be able to use your favourite wheel with their console... it's because it's simply not possible. Very dumb, but as far as i know, true.
I've never read a statement like this officially confirmed by MS. So it may be wrong after all, but i think it was somebody from Turn10 who mentioned it.