XLink in XBMC is a UI used to control XLink from a modded XBOX with XBMC installed , the engine has to be running on a computer or other platform.
make sure you can use XLink with no problems using the UI on your computer before attempting to setup XBMC.
it is well known at this time that enabling XLink in the newest SVN builds can cause XBMC to lock up. This is an issue with XBMC. However the developers of XBMC have stated that they are in no hurry to investigate and resolve the problem , patch welcome :] .. go here .. www.xboxmediacenter.com ..
upload all the icons located here ..
c:\Program Files\XLink Kai Evolution VII\avatarCache
upload all the icons into that folder , from both folders (avatarCache and arenaCache)
make sure after putting the icons in to restart both XBMC and XLink ..
update .. upon further review this goal was not allowed .. due to fatx limitations the uploading of all the icons is not possible as the filenames are to long .. being looked into .. dammit!
If you disable Kai Notifications in the Settings/Programs section it is said to help / fix the issue.
There is a guide on how to setup XBMC in the XLink download section