It is nothing like the web. The web is unstructured, Xanadu isn't. The web supports all kinds of content, Xanadu is stricly textual. Xanadu documents are immutable. Xanadu is integrated with a payment system and everything is pay-per-view. Xanadu has been worked on for more than 50 years and there's still no useful demo.
I know HN has this weird custom to assume without evidence that all old failed technologies were superior (or at least equivalent) to their more successful competitors, but it isn't always that simple. Sometimes technologies fail because they aren't that great.
The web is strictly textual too. The web browser isn't.
So that boils to Xanadu having nothing to prove in practice. Obviously atm it's doomed and you're right.
The Web is to Xanadu what a kid's go-kart is to a modern Formula One race car, if the Formula One race car somehow rewrote copyright law and solved the microtransaction problem through sheer weight of unadulterated technological awesome.
I know HN has this weird custom to assume without evidence that all old failed technologies were superior (or at least equivalent) to their more successful competitors, but it isn't always that simple. Sometimes technologies fail because they aren't that great.