On Xbox only, Mortal Kombat's balance updates do not save to the hard drive. What this means is that your Xbox console must be connected online in order to play with the latest version of the game. If it is not connected online, you are playing the retail disc version. Unless this gets fixed, PS3 will without a doubt the the tournament standard for Mortal Kombat in the future.
On a side note, I heard the 21k PDP tournament in Las Vegas is being held on Xbox. They better have plans to connect all those Xboxs to the internet.