Oh boy, everybody grab their morning glass of Metamucil and listen for a sec.
XM, obviously, is a set of “radio” stations that play whatever you select.
Apple car play is not. It is just an interface to make your car stereo more IPhone “friendly” and a means to operate your iPhone through your car stereo. (Similar to Bluetooth but not with the Apple “apps” appearing on your stereo screen.)
With it you can stream music or play your downloaded music. But Car Play doesn’t have its own music.
Car play doesn’t require phone service to work but it only plays what is already on your phone or streaming music (when you have internet service).
Car Play is either wired or wireless (through Bluetooth) depending on the features of that stereo.
No subscription required for CarPlay.
Bottom line, replacing a 20 year old stereo with features from the last decade is an upgrade if you want to use your phone with your stereo.