I don't think that'd make your site any slower. It might make your site break on apostrophes and in a few other places, but it wouldn't make it slower.
I'd ask them to install php-accelerator (
http://www.php-accelerator.co.uk). It's a night and day difference, and it's free. Of course, they might tell you "no" for some reason.
As a last resort, you COULD always look for another host.
How many GB of traffic are you pullng through X-Cart? How many products do you have in the cart? How many visitors?
You know, X-Cart was NOT written for speed. I'm finding that out the hard way. We just had to drop in a new processor and more RAM into a dedicated server because one of our sites with 400+ products and 100,000 unique visitors / month (17.5 GB of traffic last month) was starting to slow the server down. The upgrades weren't necessary to keep the site running at this point, but it was starting to get pretty slow.
I hope this helps.