Ok, I have searched previous posts, found several references to setting the timing to 12 degrees BTDC, but no explanations why one would do this on the Xterra, "just because".

Can someone explain why one would wish to do this? I have seen reference to it when people list "mods" for their X and would like to know what, exactly, that is does to increase performance.

It doesn't seem like something to do unless you have made modifications to the engine, i.e. cam, blower, exhaust, fuel system mods, etc.

Just curious.

"because" generally the more advanced the timing the more efficient the use of the fuel, provided it does not result in peak pressure ocurring before TDC. It's a dangerous game to arbitrarily advance the timing without having instrumentation to tell you what's happening. The stock settings are usually somewhat conservative however, by design.

12 is presumably chosen because it is still within specs for the 2001+, 10+/-2 deg. Mine is at 17 which is within specs for the 2000, 15+/-2.