Have you tried right clicking on an .xml file, choose Properties, then next to Opens With: app click Change, browse to Excel, choose it, if offered tick the box to Always open this file type with this app.
This is another way to establish default which sometimes works better.
Of course, but that's the problem - you cannot navigate to the Excel file/.exe. Look at the second attachment in my previous reply, that's exactly what I am trying to do (among other things), that's the subject of this topic: "Where is Excel".