Kodu Walkthrough on Joystiq
Richard Mitchell over at Joystiq has done a very nice walkthrough video of creating in Kodu. His level design is cool - I want that level! Reminds me of Scramble, which I've been meaning to recreate for like a year now.
Richard, if you're reading this, you can program the rock too - you don't have to make the enemies damage themselve. There is an additional performance cost for every character that has a sensor (vision is most expensive, bump and hearing are cheaper,) but if you only have a few rocks at a time it shouldn't be a problem.
http://www.joystiq.com/2009/07/02/video-tour-kodu-microsofts-diy-game-builder/