A Brief History
In this thread on the TalkingXena board (and this is also in response to three emails I received recently), there is discussion about the Xena DVDs going out of print.
Starz Home Entertainment (formerly Anchor Bay Home Entertainment[ABHE]) no longer holds a distribution agreement to distribute both Hercules and Xena on DVD. In late 2002, Davis Anderson Merchandising (DAM) (the licensee to put both shows onto DVD) entered an agreement with ABHE to distribute the DVDs to retailers nationwide.
In the summer of 2002, Universal sold the DVD license to DAM to produce, market and package both shows on DVD. Universal has no involvement with the DVDs. DAM tried releasing the first season of Xena in November 2002. It did not sell well. This is when they entered into agreement ABHE to distribute the sets to retailers.
The Out-of-Print Status
"Out of print" basically means that it's no longer being manufactured. This is not uncommon. In fact, it's pretty common for studios and distributors to pull DVDs off the market for a period of five to ten years. Sometimes longer. Disney Home Video is known to release a DVD for a year and then put it in the vault for another seven.
No longer available then?
Well, it'll be available to purchase through third party sellers and the LegendaryHeroes.com website. (Keep in mind, DAM many have to produce the sets themselves. This translates to an extended waiting time to get the DVD sets.)
There is no change of licensing to my knowledge. It's possible that the license has run out with the DVDs for DAM. But I don't know about the license agreement.
I did a check of the release sheets and asked around, there is no future DVD releases of Xena in the next two years through a mass distributor (such as Starz Home Entertainment). If it were to be released, it'd be through DAM.
Hope this clears up any conclusions. As always, you can get a complete breakdown of the Xena DVDs here.