Ideally a retrofitted projector headlight would be best for HIDs.
The main problem of aftermarket HID kits blinding other drivers
is due to the fact that the bulb is entirely exposed. Many halogen
housings are made where the entire bulb is exposed, meaning if you
look inside from the front, you can see the entire halogen bulb. In these
cases I agree that sticking in an HID xenon bulb will blind other
drivers.
However, if you look at the Xterra housing, there is a metal cap/shield
in front of the halogen bulb. Basically, you can't see the halogen bulb
except at an angle. Even then you see only a part of the bulb.
IMO this solves the problem of an exposed xenon bulb and blinding
other drivers. Essentially, with the front of the bulb blocked off, a
xenon bulb in the housing will follow the same reflective patterns of a
halogen bulb, just with a whiter, brighter light.
I haven't had the need to adjust the headlights after installing the
HID kit. Been using for about a year now and no problems. Install
of the kit took less than 30 mins. It is the best $130 spent.