Validation is technically a guideline. If a site works, it works. You might have some custom tags that won't pass W3C validation, but they'll work because you defined them on your own. Take a look at Myspace, for example. The site works, even with an average of over 100 errors on every page, some going beyond 300 errors.
The big thing to note on the difference between HTML and XHTML is the case-level. HTML tags can be either uppercase (<HTML>) or lowercase (<html>), but XHTML must
always be lowercase.
The slash in <br /> is because it's an empty element, like <img /> or <link /> or <input />. Without the slash, it's like using <div> but never using </div>. That said, you can also use <br></br> or <img></img> and it will still validate.
