After extensive trial and error, we managed to solve the problem. It is definitely the ProApps update. We couldn't update our OS and didn't have a full clone backup. We started by creating a drive with a clean OS 10.6.8. None of the XDCam files would play without the Sony Codecs. We then downloaded the latest Sony XDCam FCP "Log & Transfer" application which comes embedded with all the working XDCam Codecs.
Unfortunately, that software would not install without a running version of FCP so we did a fresh install of FCP 6.3 (I think). Once that was updated to 6.8, the XDCam Log & Transfer could install and we were able to again see XDCam QuickTime files. YES. Unfortunately, most of our FCP project files were created with FCP 7.03 and now wouldn't open. We no longer had the update disks to go from 6.8 to 7.03! Ouch.
Out of sheer frustration, I went back to the old drive, did a fresh install of the XDCam Log & Transfer and also, just out of curiosity, I replaced all the files in the Library/QuickTime folder with the same files from the fresh install disk we had just assembled that was able to play the XDCam QT files. Guess what? It worked!
I am not certain whether it was the fresh install of Log & Transfer or the replacement of the older files in the QuickTime folder that might have been tainted by the ProApps update, but who cares. We are up and running again.