Hi All,
I made some tweaks and got it so when modifying the product you select the option for free ground shipping under the free shipping drop down. This then will display a specific shipping charge/zone that you setup.
I have posted it on my blog and I will work on moving it into this forum once I have some more time (hopefully later today).
Let me know your thoughts.
http://joltedlabs.com/software/x-cart/free-ground-shipping-mod
I have not fully tested this yet so feedback is welcomed. At the same time make sure you test this on a dev site.