The opinion of James Walker would be most helpful in this area, as he is a mallet player extraordinaire and also endorses the Xylosynth.
DnD's kind (and greatly appreciated) comments about my playing notwithstanding, he's right - I do endorse the Xylosynth. I played the MalletKat for three or four years prior to making the switch, and it's a fine instrument, but I decided that the XS's strengths were more important to me than the MK's were. Both instruments are "professional quality" and are worth checking out.
I don't know Neil's setup or applications for the instrument - so I can't comment on it. I'll have to check it out, just for my own benefit.
I thought I posted a review of the Xylosynth here at the Cafe, but searches come up empty. I have a review of it (and some comments comparing it to the MalletKat) on my web site:
http://www.malletjazz.com/xsreview.html...and there are links to a page with photos of the instrument, as well.
In terms of buying a "used" instrument, you'll find the occasional MalletKat on eBay (but never a Xylosynth - they're just too new to the American market). I'd avoid the old kind, with the one-octave base unit, in favor of a "MalletKat Pro," which has a three-octave base unit (expandable to five octaves). The old version was made before Alternate Mode took over the company, and...let's just say those instruments had problems.
The MalletKat is available with or without onboard sounds, while the Xylosynth does not offer onboard sounds. Personally, I don't miss having onboard sounds at all, but some players like the "plug in and play" aspect of not having to MIDI up to an external synth.
One last note: in terms of portability, remember that you'll need a stand, and some sort of amplifier, two items one doesn't need for a xylophone.
Now, all we have to do is coax him away from the world's largest (and coolest) snare collection long enough to get his opinion.

Few people realize how tough it is to type with an Acrolite under one arm, a Tempus-shell under the other arm, and a piccolo snare in your mouth!
(cue Dr. Smith voice) Oh, the Herculean effort I make to participate at the Drummer Cafe... 