X-Affil works by writing a cookie. URL re-naming shouldn't get in the way (that is, if you're using the link generated by x-affil, and not the "pretty/logical" urls from DSEFU).
On a different computer or browser, try to use an x-affil link -- wipe all cookies first. Then analyze the cookie -- is it writing?
The only thing that really matters for an x-affiliate link is the very first point of entry, when the cookie is written. At this point, the customer's browser then has a cookie and there is no URL tracking (which is different than other affiliate systems which will maintain an affiliate code in the url all the way)
So - if a cookie is written, you're good to go. Try testing on a 2nd computer (wipe all cookies and cache before using the incoming link).
Jeremy
PS -- if anyone is searching for a solution,
this rant may help you.