I think the difference between the Beatles and Elvis, as far as their impact on what came after is concerned, is the difference between influence and innovation. They both clearly influenced most everything that came after them; but the Beatles are the only one of the two who could be considered really innovative.
Sure, Elvis and Sam Phillips did something new(ish) which was largely responsible for his huge success. He mixed black music with Gospel music and it worked. But the thing is, that's not even something that can be solely contributed to him. There were certainly others doing the same, some before he did it. But the reason he got the airplay and the sales is because he was white. So, really, the only thing he did that was different, as far as the music is concerned, is to be the first white guy to perform that style of music. That certainly made it easier to sell that style to white kids in the 50's. Yeah, he was certainly a showman, but I'll take music over show any day. And as far as his voice, he was a good singer, but nowhere near being a great singer.
And then there is the Beatles. No band or musician has shown the innovation they have...ever. The music, the production, the recording techniques...The Beatles and George Martin actually created new sounds out of nothing. There is no way, regardless of how much you stretch it, you could say that either Elvis or Michael Jackson came anywhere close to that kind of innovation. Sure they had some songs that you could call silly, I guess. But with their extensive catalog, they get to do that. Even the songs that were mentioned by the OP ("Being For the Benefit of Mr. Kite", "Lucy In the Sky With Diamonds", "Yellow Submarine") are far more complex than he seems to think they are, particularly when heard in the context of the album sides on which they're found. Honestly, I can't take seriously anyone who would suggest that the music of Elvis, regardless of how good it might be, could approach the sophistication and musicality of the Beatles. Elvis did dabble in a few different genres, certainly more than MJ, but I don't think he approached the stylistic diversity displayed if you listen to the entire Beatles catalog.
Other tidbits about the Beatles worth pointing out in light of some other comments in this thread:
1. I think Goodbook is probably the only person I've ever encountered to believes the Beatles couldn't sing. Seriously?!? Listen again, my friend. Paul and John (especially Paul) have two of the best rock voices of their era. Keep in mind that, just because Elvis sang gospel and they didn't, doesn't make him the better singer. Pau McCartney still has pipes.
2. As someone else has already pointed out, the Beatles (Lennon in particular) never believed they wer greater than Jesus. It was an off the cuff comment from John that had some real truth to it, but was misunderstood and misinterpreted. In fact, he was devastated in the crazy aftermath of that comment and upset because he didn't want people to believe he believed what so many were claiming he meant. He was genuinely sorry and quickly clarified what he was saying.
3. So the Beatles's songs won't last and be remembered beyond their generation because they're not Scripture? First of all, tell that to my 11-year old nephew who likes the Beatles. When you consider songs that are part of the nebulous "great American songbook", you will not find any song written by or made popular by Elvis or MJ. You will find many songs written by the Beatles. Elvis will always be known for his persona and legend. I can guarantee you that our great-grandchildren will be living in a world in which the Beatles are still being played and appreciated.
Yeah, I like the Beatles a bit.
My ranking:
1. The Beatles
11. Michael Jackson
111. Elvis