A XC bike can handle all sorts of terrains.

It just demands more technique on rocky terrains, esp. downhill. These are just some screengrabs from friends' trip reports, and they are definitely not even close to the most technical sections that we rode through.  XC bikes allow us to cover much longer distance (sometimes, even near 100 miles) on trails. 

There are people who can handle the very technical terrains on their hardtails, or even rigid bikes. It's all about technique. 

But a downhill bike is more comfortable, and sometimes safer, on the downhill oriented rides (esp. in bike parks).