You've found the main advantage of using a text list of URLs -- it's easy to make a text-file like that on your own. However, once you go past a certain number of URLs, making it manually just isn't worth the time, and if you're going to make a Sitemap file with a tool, the simplicity of a text-file doesn't really play a role anymore.
By using XML files, you gain the ability to provide more information than just URLs. For instance, you could include the last-modification date (to signal that a URL has changed), or you could even start adding other content types, such as images and videos.
With a bit of practice, it's still possible to "read" XML files yourself. However, I wouldn't recommend making them by hand, it's just too easy to add mistakes, so if you haven't done so already, you might want to take a look at the various Sitemap generators.