Both Canon 400D and Canon SX120 IS have 10.0 MP resolution sensors but Canon 400D's sensor is APS-C (22.2 x 14.8 mm ) and Canon SX120 IS's sensor is 1/2.5-inch (5.744 x 4.308 mm ).
Since Canon 400D's has a larger sensor area with the same resolution, this means that it also has a larger pixel area hence better light collecting capacity for a given aperture compared to Canon SX120 IS.
Below you can see the 400D and SX120 IS sensor size comparison.
As seen above, Canon 400D has a 13.3x Larger sensor area than Canon SX120 IS. Larger sensors give photographer more control on the depth of field and blurry background compared to smaller sensor when shot in same focal length and aperture.