Code:
[External compressor:xtool]
header = 0
packcmd = XTool.exe precomp -mcp2077 -c128mb -t100p --dbase $$arcdatafile$$.tmp $$arcpackedfile$$.tmp
unpackcmd = XTool.exe decode -t100p - - <stdin> <stdout>
Try using these settings and what are your system specs?
Also if there are errors that xtool reports, I want to see the error message.