I was pretty disappointed with my Xterra. If all you need is something to look cute driving around town, you'll enjoy the Xterra's rugged looks and relatively easy handling. Try and get it dirty however and you'll be disappointed. It slips easily in ice and snow (turning, even with 4WD is precarious), the mud factor wasn't great either, even in 4WD low. The interior is hard to keep clean, and the outside dents easily. Passing people on the highway is nearly impossible, even with the bigger engine option. And of course, fuel economy is horrendous with gas as much as it is now.
Tows well, good visisbility, good ground clearence, stylish.
A more responsive engine, mirrors on visors, sturdier interior, and if you're going to market it as an off road vehicle, prove it!