The stock Xterra has a good height compared to many other SUV's coming out now but if you go offroad you'll want more height to keep the belly from hitting the ground. The Calmini is arguably the best suspension lift you can get.
A quick word on lift types, there are two main kinds: the Suspension and the body lift. The suspension lift changes your suspension so that the frame and chassis are higher off the ground, the body lift just lifts the chassis higher off the ground the frame stays at the same height. Suspension lifts are limited with IFS because the control arms can only be at so sharp of an angle before they really mess with the geometry, anything over 3" requires a lower control arm relocation bracket, which eliminates all clearance you gain by lowering the frame. Plus the steeper the CV axles the more stress on the CV joint. Body lifts don't have any real benefit except allowing you to fit larger tires. Anything over 3" can lift the body too high and the mounts can become distorted when the frame flexes.
Bilsteins are well regarded as the best shocks you can put on your Xterra, alot of people have been putting on Adjustable Rancho RS9000's but the Bilsteins automatically adjust to conditions and provide a GREAT ride. If you're planning on lifting the Xterra then make sure you get shocks that are going to be able to handle the extra travel without maxing out their extension. Shocks aren't built to be limiting straps and will break if they have to be one.
Whatever shock you get be aware of which direction it's mounted. Depending on the manufacturer they may go canister up or canister down. The reason is that some shocks have reflexive valves that depend on gravity to keep them in the correct position. The result is that if they're upside down they may make the ride worse.
Lifts will take their toll on the centerlink pretty quickly, Calmini has a very stout upgrade that is rebuildable and will solve the problem. The entire system is replaced unlike other systems that just reinforce a weak system. The result is a longer lasting steering system, but it takes a few days to get used to the new physics of the steering when it's first put on. The Pitman and Idler Arm are replaced with stronger pieces, new stronger tie rod adjusters and a new center link is given.
My stock Long Trails got their use off road, by time I replaced them they weren't much more than racing slicks; not only does that increase the chances of them failing, but they suck in any type of slippery situation. I thought long an hard about whether to upgrade to BFG All terrain of Mud Terrains, and tried to decide between 31"s of 32"s. The MT's had more aggressive tread and could "paddle" through mud and snow, but they also dug holes in the ground faster and weren't siped for winter driving. The AT's were siped and had better road manners but the tread wasn't aggressive which could render me stuck in situations the MT's could get me out.
I decided to go all out and get the bigger 32" Mud Terrains.
The stock Xterra comes with the equivalent of 29.5" diameter tires, and you can go up to 31" inches with out batting an eye but if you go larger your probably going to have problems with the wheels rubbing the fender. With 32"s you'll just need to trim some plastic in front and behind the tire, all you need a is a razor blade and 20 minutes. If you go larger you may need to trim metal, and if you don't have a 3" suspension AND 3" Body Lift you'll probably be rubbing the top of the fender at full compression. Basically 33" tires and up need alot more trimming work than 32"s and below.
Airing up or down on the trail is one of the basics to 4 wheeling, you almost always need to air down and when you get off the trail you need to get your air pressure back up so your tires don't suffer the same fate so many Ford Explorer tires suffered. You can go with one of two options, first is onboard air, an air compressor and storage tank that you can fire up whenever you need the pressure, it's a cool idea but pretty expensive since a decent compressor is in the $400-$500 range. Add another $80 for a tank, and $50 for plumbing and you have an expensive setup, not to mention that it can be damaged since it's on the underside of the vehicle.
The second option is CO2. Carbon Dioxide stored as a compressed liquid can be used to fill tires, set beads on rims, and run power tools. Plus it's removable when you don't need it. All you need is a good place to keep it and a CO2 tank can serve all you air pressure needs.
