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XVCD stands for eXtended VideoCD. It is not a real format unlike VideoCD and SuperVideoCD are, but instead it is a hack/extension of VideoCD format. Instead of using VideoCD's constant bitrate of 1150kbit/sec, the video can use up to 3,5Mbit/sec bitrate, providing better video quality. Also the resolution can be higher than VideoCD's CIF resolution -- full PAL/NTSC resolution can be used instead.
The problem with XVCD is the fact that it is not a real standard and therefor only some standalone DVD player can play these discs. And of course using higher bitrate causes the problem that one CD can contain less video and your movies end up taking more CDs (VCD uses 1,1Mbit/sec bitrate and if you use 3,5MBit/sec, obviously the CD can only contain appx. 1/3 of the length VCD can -- average of 25 minutes per CD).
See also XSVCD.