Well,

The question you need to ask yourself is how much serious offroading are you going to do? If you envision your SUV as a family car, a work vehicle and a moderate to serious offroader then go for the Xterra. The platform is proven and has plenty of mods on the market or coming to the market. The Xterra would be much more fun as a moderate to serious offroad adventure vehicle.

If you want a reliable SUV that can haul the family (up to 7 people) to town or on long road trips and can navigate through shallow mud and snow then go for the Pathfinder, especially if you have concerns with interior cabin space. I'm not saying the Pathfinder doesn't have what it takes to get busy offroad but it is longer and wider with independent rear suspension. The Pathfinder also offers more comfort options then the Xterra.

In fact, we're think of getting a Pathfinder for my wife when we finally decide to have kids.