I've still not found a solution for the template_c directory and after a week I still haven't got a chance to succesfully install x-cart.
This is what my hostingprovider said:
777 permissions, ie. world write privileges are serious security holes. Any
malicious entity could upload content directly into your webspace. Directories
marked as 777 have allowed exploits to be uploaded, compiled, and executed,
thereby, compromising the integrity of the affected server. When PHP is
upgraded to 4.3.2, no file uploads will be possible. We suggest you use
a CGI script to facilitate uploads.