.query restituirà sempre il tipo di dati XML.
Per interrogare un valore dovresti usare ".value" e specificare il tipo di dati come secondo parametro.
Usa questo invece:
declare @xmlobj as xml = '<SimpleUserData xmlns="http://schemas.datacontract.org/2004/07/MyProject.CustomFx.Web" xmlns:i="http://www.w3.org/2001/XMLSchema-instance" xmlns:z="http://schemas.microsoft.com/2003/10/Serialization/" z:Id="1" z:Type="MyProject.CustomFx.Web.SimpleUserData" z:Assembly="MyProject.CustomFx.Web, Version=1.0.0.0, Culture=neutral, PublicKeyToken=null">
<BatchDescription z:Id="2">I want this value</BatchDescription>
<BatchID>9c437c08-0f28-4c77-9a50-49a7a4e8930a</BatchID>
<BatchTemplateID>And this value too</BatchTemplateID>
</SimpleUserData>';
WITH XMLNAMESPACES('http://schemas.datacontract.org/2004/07/MyProject.CustomFx.Web' as x)
select
@xmlobj.value('(/x:SimpleUserData[1]/x:BatchDescription[1])','nvarchar(max)') as value1
,@xmlobj.value('(/x:SimpleUserData[1]/x:BatchTemplateID[1])','nvarchar(max)') as value2;