That's an important thing to note. The problem, however, is that a lot of people seem to be defending XML retroactively, because that's the choice that was made. An appeal to authority, if you will.
Realistically, it's completely understandable that XMPP was built on XML, and it made perfect sense at the time - but that should not preclude us from acknowledging that there are serious usability issues with it.
By the way, XMPP predates JSON or at least stems from a time when JSON was not jet standardized or widely accepted, so at least in the context of XMPP the XML vs JSON debate is pretty futile to begin with.