The game starts with you investigating a riot at a prison. It seems that a criminal called Underboss escaped in the confusion. You spend the rest of the game tracking him down.
As mentioned this is uber boring. There are only a handful of different enemy types, and with the exception of the last level no boss fights to break things up. The levels are bland as anything. This can be demonstrated in where they are set - Prison, Streets, Docks, Sewers, Rooftops, and finally a construction site. Woop de doo.
The 2 characters play differently. Rorshach has very violent special moves, brutal, with blood and teeth shattering. He can also pick up enemies dropped weapons and cause more violence that way. Nite Owl on the other hand is bland. He can't pick up weapons, and his moves are boring. The game can be played in co-op but I never tried this.
One thing it does have going for it is that it looks fantastic, one of the most graphically impressive games on X-Box Arcade. Wonderful weather effects, character models, and lighting. Between levels are cut scenes set out in the style of the graphic novel which look great.
This is part 1 of 2. I never bothered picking up part 2 based on my unimpressed impression of this one. If it ever drops in price it is worth it, but otherwise at 1200 Microsoft points it is just not worth it.