Well, obviously this is a Toyota board so you're going to get Toyota bias here. Having said that, I cross shopped the 4runner and the Xterra and ultimately chose the 4runner.
If you can get a 99 or 2000 4runner, the stock suspension is higher than the Xterra and off road capability is excellent. I often get asked what kind of lift I have on my 99 4runner (I don't have a lift, it has the stock suspension with a slightly larger than stock tire - 265/75/16 vs the stock 265/70/16.) Removing the running boards also gives it the appearance of a lift.
From an off-road standpoint, the ability to get a factory E-locker makes the 4runner the better vehicle, hands down. AFAIK even the Xterra didn't get this option until 2008 or 2009. And of course the 2nd gen Xterra has the annoying pushbutton transfer case, vs. the 3rd gen 4runners' reliable lever.
Also, IMO Toyotas just give you more "bang for the buck." Lots of little things on the Toyota are quite nice - things you wouldn't neccessarily miss if your vehicle didn't have them, but which you come to really like. I'm talking about things like:
* Auto-up and auto-down front windows (both driver and passenger)
* 3 12v power outlets on the dashboard and 1 in the cargo area (99+ only)
* Nice little storage compartment in the right rear cargo area for tools, fire extinguisher, warning triangles, etc.
* Roll-down rear window (very nice when you're carrying fishing rods, surfboards, etc, as well as for ventilation)
* Heated power mirrors that fold flat against the door when driving on narrow trails or parking in small parking spaces
* Split folding rear seats (not sure if the X has this) with storage slots for the headrests (99+ again) which makes for a very versatile cargo area.
* Headlights automatically turn off if you accidentally leave them on (keeps you from wearing down your battery.)
* Separate rear seat heater with separate controls for the rear passengers (not sure when this was added but my 99 SR5 has them)
* Rear window defroster is not only on the back window, it's also on the rear side windows.
* Easy to remove luggage rack crossbars for a better appearance/MPG.
* On 99-2000 Limiteds and on all 2001 - 2002 4runners, you get the multi-mode T-case, which is great for driving on icy or intermittently slippery roads.
* More sophisticated rear suspension (4 link with coils vs leaf springs.) Smoother ride and better articulation.
* ECT on auto tranny has power/economy mode (not sure if the X has this but I don't think so.)
Given all of the above, and the fact that they are comparably priced on the used market, I'd say the 4runner wins that contest, but then again I'm obviously biased, so take that for what it's worth. :shrug: