I've done it, using VNC and RDP apps. Sort of usable, but the current Xcode UI really needs a larger display. If you know how to develop using the command-line, SSH-ing into a Mac actually works better. You can use iDisk or something like DropBox to have your source code files accesible from both the iPad and the Mac.
A touch-centered UI that runs Xcode remotely via AppleScript or some other protocol sent over the net might be the way to go.