Your problem is that you are too stuck in just one way of doing things. So I guess it makes more sense for you to use some OS X application. But I do know that all that I have tested (and that probably includes any you are trying to play with now) all are pretty buggy when it comes to actual functionality. They look pretty, but they are pigs, even if they have lipstick. I am happy to use various tools if there's a sane reason to do it - however I fail to see any concrete benefit of using xterm over Terminal.app on OS X. Again, what is the show-stopping bug that should make me swap over?