You could do that, but you'd want to export it to an easier file format to read (CSV for example). It really depends on what you want data you want in the file.
XNA / C# has excellent support for XML, which is what I tend to use for level data. What you can do is create a class that contains the data for your level (eg. an array of meshes, start locations, level name, music track) you can then "Serialize" the class which saves it as an XML file which you can then de-serialize to give you an instance of the class with all the saved data. That way you can use the same class in a seperate "level editor" project to produce valid data.