Since this thread was "necroed", I should say I have re-evaluated my stance on Indie. I tend to dislike most indie gamed because all but maybe 2 of them I've played were terrible. I generally avoid them now because of this, but if I happen to hear of a good one the fact its indie won't stop me from playing it. That being said I still don't think Indie games have a place at E3.
They don't have a place at E3, because E3 is a Trade Show for Big Journalists, and AAA games. E3 is a trade show only, but Indie games do belong a Pax, a games convention.
...with that being said, why not? Indie games are mostly, the only games that take real design risks, and try new things... so why not allow them to E3?
Now, I will tell you some Indie games (They are probably label "Arcade games", as for Mircosoft dumb policies), that are great on Xbox.
Minecraft (The Obvious One)
Terraria (A 2-D, Minecraft-esque, adventure game. However, it offers much more exploration, and character progression, then Minecraft.)
Mark of the Ninja (A Stealth Platformer, where you can go murder everyone, or never raise a blade)
Dust: An Elysian Tail (An Action RPG, with a beautiful world, and an immersive story)
Spelunky (Spelunky is a cave exploration / treasure-hunting game inspired by classic platform games and roguelikes, where the goal is to grab as much treasure from the cave as possible.)