As I understand it, Kent Beck chose the word "Extreme" to convey the idea of turning all of the knobs to 11. Instead of using a design-code-test-debug-build-ship approach that takes each step in order, XP says to design continually, test continually, build continually, review continually, ship early and often.
It's extreme because it advocates doing all of the good activities of software engineering as much and as often as possible.
(On the other hand, if you mean the article simplifies things, you're absolutely right. The real world's too complex to cover everything in 500 words. There are still plenty of things to learn from XP, even if you find it's not appropriate in your situation. :)