It seems to me that xbit is no more distinct or intuitive than µbit. In either case it's simply an arbitrary character in front of the word "bit". Of course, for the majority of the world familiar with SI, the µ actually adds additional meaning that is lost with the x.
Furthermore, given the multiple concerns voiced about the overuse of the word "bit", µBTC seems to solve the problem.
Since we are talking about how it would be displayed in software, we don't need to be concerned about how people will pronounce it, or what the nickname will be. If most of the wallets start displaying amounts in µBTC quantities, it will be obvious that a µBTC is a different magnitude than a BTC. Nobody is going to look at their 100,000 µBTC balance and think they have 100,000 BTC. People will immediately make the mental adjustment to the new order of magnitude even if they don't specifically know that µ means micro, or that micro means 1e-6.
Nicknames will form organically (much like buck, fin, large, k, grand, and benny for U.S. currency), I've always been partial to milly (or millie) and mike (or micky) as nicknames for mBTC and µBTC. I've personally used those when speaking with people, and they seem to catch on pretty quickly.
As has already been mentioned, you're going to be hard pressed to find software that denotes U.S. balances in "bucks". There isn't any good reason to be coding a nickname like "bit", "xbit", or "mike" into wallet software.