One other thing to keep in mind is that you need a certain amount of
developer to fully develop a roll of film. For XTOL, Kodak recommends at
least 100ml of stock solution per roll. Depending on your tank, that means
you might not be able to go beyond a 1:1 dilution without violating this
recommendation. This is one of several factors that have been blamed for
the "XTOL sudden failure" problem, so if you try experimenting with higher
dilutions, be aware you could completely ruin a roll.

That said, I get the impression that Kodak set this limit fairly
conservatively, and based on the needs of its T-Max films. You're more
likely to be able to get away with higher dilutions using other films, and
even with T-Max, you might succeed with higher dilutions. Using a big tank
would be likely to help, I'd imagine. For instance, with one roll in a
500ml tank, you'd be able to go to a 1:4 dilution and still have 100ml of
stock solution.

...

...

apr1505 from Lloyd Erlick,

Another consideration is convenience.

I use Xtol diluted 1+2, because one liter of stock dilutes to three
liters of working solution, which very conveniently covers ten rolls
of 120 format film (which are spooled onto five Jobo 1501 reels, two
rolls per reel).

As it happens, a five liter package of Xtol divides neatly into five
one-liter containers, so I just have to take a bottle of stock and mix
it to three liters.

I process fifty rolls of film this way with each pack of Xtol. That
means nearly two hundred and fifty dollars worth of film are processed
by eleven dollars worth of Xtol. Pretty cheapskate going, even though
Kodak is involved ...

regards,
--le

I explained this earlier. Diluting more does increase sharpness if
you're diluting a solvent developer, because the solvent developer at
full strength reduces sharpness.