People tend to hang on to JRPGs for the collection, rather than sell them once they're done. Xenogears, even for a JRPG, is a remarkably complex, idiosyncratic, bizarre game-- the kind of thing that provokes extreme love-it-or-hate-it reactions, so fans who love it really love it.
Now, why Square hasn't just reprinted 18 billion copies of it to meet the infinite demand, like they have with Final Fantasy VIII, Final Fantasy IX, and Chrono Cross, I couldn't say. Maybe it is tangled up in the same contractual difficulties that are preventing them from doing additional reprints of Final Fantasy VII?