Yes, the alternator is mounted very low on the Xterra, something that all of us don't like. However, when you're in deeper water, you do get the bow wave effect (especially if you're running skids) such that the alternator and engine stay pretty dry if you keep the momentum up. I've had water come up over the hood prior to have a snorkel and had no problems. But, and it may be here in the thread somewhere, if you want it to be airtight you have to get the Volant CAI, which means relocating your horn, too. The newer models of that don't have the bump out that lets you keep the horn in the stock position. Then make sure you seal up the connections nicely.
That being said, it's worth it. You get piece of mind in the water but the biggest reason is to help you get a cooler and cleaner air stream, and that it does.
Plus, women love them. Truth. And by love them, I mean that most women will look at you like you're a damned oddball.