I have had and raced both cars, the TC3 for longer, and am currently racing a TC3 for a few different reasons:
1)parts, my hobby shop stocks tc3 parts, and they are very easy to get from many different places
2)local crowd: alot of people run tc3's, as well as a AE driver is at my track, so finding a good set up is easier
3) working on the car: i can change an arm within 3 minutes on the tc3, the xray even with the c-hub conversion takes over 10 minutes, and its requires taking apart the whole front end. also the diffs are hard to take out, and everything is built together, so you cant take it off in sections like the tc3, the tc3 you can replace any part in the whole car within 10 minutes, most in alot less time.
the xray is a great car and it can probably be made to handle better, however the drivetrain in the tc3 is untouchable, and thats huge in stock, also the price, overall i prefer the tc3.
and the mods that josh did are not major ones, just alot of minor ones, and he didnt even make the main in cleveland. stuff like nitro tc3 shock towers (he only ran the losi ones over the AE ones for extra stiffness), batts moved to the center, and losi hubs (since AE does not offer hubs with those settings) are all things you can do yourself, and does not mean the tc3 is not as good of a car.