i am on my second xterra, the first one was a 2001, the one i have now is a 2007. i absolutely love my 2nd gen xterra, they are much improved in many ways over the first gen.
the first gen xterra was a good solid vehicle, when i sold mine it had about 120k miles and EVERYTHING still worked. it was a 2wd SE model with lsd and auto trans, i averaged about 15-16mpg city and about 18mpg on the highway... not great.
some of the good points... the ride is good for a truck, rear seat room is good for a small suv, offroad performance is excellent (i beat the shit out of mine and it always took it, rarely got stuck, even with the 2wd), it pulled boats up to 23ft and about 6000lbs, the interior still cleaned up like new, very maneuverable/easy to park, reliable transportation.
the problems i had with my 2001, all of which occured after 90k miles... cracked exhaust manifold, radiator cracked and leaked, rust above rear hatch that leaked water, ball joints wore out. as for the 190hp 3.3 liter engine that most of the first gen Xs have... i didnt hate it that bad. its very torquey, always pulled boats great for me, not a speed machine on the street but its adequate. compared to my new X, the trans shifted a little harder, but it was very reliable. i drove that truck on many highway trips and it was always good to me.
i still say, if there is any way you can swing it, pick up a 2005
