The fact that Xena "reportedly" made Universal (then MCA then Universal then Studios USA) millions of dollars is a moot point. We, the fans, don't know how much Universal (etc) made off of the series. It could be that they just broke even, were always in the red, or did make money. But just because Xena was the top rated syndicated series for several years does not guarantee a movie is in the works or even deserves to be made.
I refer you to my previous comment from the November 3rd post:
Studios do market research to see what a movie will make at the box office
(domestically, meaning inside of the United States). They analyze genre, talent
pool, story, etc, etc and if the market is not warm to it, that hurts the bottom
line of the budget. If a particular movie doesn't look like it'll fair well at
theater, it'll significantly impact the budget (or lack of) offered to a
So, I say again, it's about marketing and genre.