This may have been listed somewhere, but if not I wanted to fill you guys in on what I discovered. It's been established that the hood is a bit loose, so there is leeway for it to bounce around a bit, but in my case there was no metal on metal rubbing anywhere that I could find. Low and behold it is where the welded hook on the hood where the hook goes into the hood latch; b/c of the leeway in the hood the hook would slide and bounce around in the latch creating the squeak.
I tried spraying on the rubberized undercarriage spray, but eventually it would rub off, that as well as good ol' duct tape. I haven't found a permanent solution, but as of now I have a strip of foam weather striping wrapped around the hook. It's sticky on one side and about 1/2" thick, so it creates a tight fit. I've had this on there for about six months and with no squeak what-so-ever, but I can see that it's starting to wear down, so it'll be time to replace it soon enough.
I would bet that probably for most of you it's the same issue. I remember it being very hard to pin point exactly, so I wanted to share this with anyone who isn't quite sure of it's origins. Nissan tried the whole hood tightening and adjustment thing and it did nothing for me; they actually thought that it was the skid plate originally.
Anyways, I hope that this helps somebody.

I have been living with this squeak for weeks now and this weekend after a few hours of listening to it while offroading I finally had enough.

When I got home it took a total of five minutes to search the forum and 2 minutes to stick the felt pad (I already had some) and the squeak gone!!!

Thanks to all contributors and thanks to Xterra Owners Club!!! I only wish I had fixed it earlier...

The hood squeak is a common problem , we have a TSB that explains how to get rid of it.

Just extend the length the the two hood bumpers by unscrewing them until it's length is about 20 mm.

If that measurement cannot be obtained, buy new bumpers and measure accordingly. Simple as that.