OK so I've had my gen2 xB for about five years now and wouldn't trade it for the world. We bought my brother a gen2 TC for his birthday 3 years ago. Given I'm an xB owner I'll be the first to say to get the xB but I know my brother loves his TC and would say different. Here's what we've sorta figured out from the two cars:
+SUPER SUPER roomy
+incredibly customizable and easy to upgrade
+100% short people friendly, no craning your neck over the dash and everything is comfortably situated around you
+lots of space to work with an already awesome sound system
+speaking of sound: good amount of clearance under the back seats to add shallow subs, that way you don't take up space in your trunk
+seats fold down to make even more room in the back, great if you've gotta haul something
+you can pack it full and nobody feels squished, so it's great for hauling your buddies around
-can be a little bit clunky at higher speeds and hates the wind. However when we lowered it just a wee bit the problem got a lot better. It's a nice, zippy lil car now.
-gas mileage can get bad at higher speeds, however cruising at 55mph does wonders
+/- Instrument panel sitting in the middle can be a lil bit awkward to get used to. However now that I'm accustomed to it I couldn't imagine driving any other way! You can see everything you need without really looking away from the road. Don't know how I ever functioned in my truck.
+ Easy to upgrade/alter. My brother has turned his into a front wheel drive speed machine.
+ Great handling, takes hard turns pretty good and handles my brother's awful driving without any trouble
+ It runs a very similar sound system to the xB, meaning it sounds AWESOME
+ has a little bit more go to it
+hatchback with a good amount of space for stuff, just not as much as the xB
+ Great gas mileage
-no cute cartoonishly square shape
-two doors means it'll always be kind of awkward getting your friends out the back, so not great for hauling more than one buddy at a time
-not even close to as much room or awesomeness as the xB. Just bought that new 42" tv? Too bad, you're gonna have borrow your friend's xB to bring it home.
+/- Ricer status
+/- Instrument panel behind the wheel like a normal car. BORING!
My brother's insurance is about the same as mine, however since he's a kid we pay a bit more for him. Tl;dr both are really fun to drive and have great features so it all boils down to personal taste. If space and awesomeness is your concern you would want the xB. However if you're the kind to get insecure about driving something cartoonishly square then you may want to think about the TC which looks a bit sportier at the expense of space. Both are great, super reliable, good gas mileage. If you want a car that lasts then Scion's got your back!