using debian squeeze
the file .xinitrc in your home irectory is still the same:
exec /usr/bin/xbmc --standalone
edit your /etc/rc.local and put it there:
su -c "/usr/bin/startx" yourusernamehere
and voila xbmc will launch automticly after all init scripts has launched.
btw i have shriked debian to 700 mb and i have everything working