XREFs are one of the most powerful and the most confounding tools that AutoCAD and other CAD programs have introduced. Get them right (which is actually easy to do) and your work is much easier and well coordinated. Get them wrong (which can happen) and you can get twisted into a knot so tight that you cannot get out of it.
One of the most important parts of XREFs are the paths that they use to find the files. You can use Hard coded paths or relative paths. Read more about these options here.
So here are some thing you could add to your CAD Standard about creating and using XREFs.
Xref Path Names
All Reference file attachments will be saved using relative paths. Relative paths do not include the drive letter and reflect the location of the reference file as it relates to the active file.
Relative path names can be created in AutoCAD by using a shareware program called XRP. AutoCAD 2004 and beyond has a variable setting to allow for relative paths.
Reference files shall be added on a specific layer and the prefix for that layer shall be “$xref-“ followed by the reference file name. “$nref-” shall be used as a prefix when attaching nested reference files to model files.
Only use one level of nesting. Do not overuse nested reference files. Attaching a file to create a Nested XREF should only be done on Model files. Do not create nesting on Sheet files.
The lisp routine “XRP” will correct the hard coded paths to relative paths in AutoCAD 14 thru 2010. AutoCAD 2004 and beyond allows for attachments with relative paths. It must be done at the time of attachment or fixed with XRP after the fact. Get XRP – you need it.