One of the issues with AWD is that there are several considerations
that owners must take into account to avoid damaging the AWD system.
As an example, tire size must be closely matched. This means if you
have a flat with 10K miles on the tires you should buy four new tires.
Failure to so this (and follow other guidelines like frequent
tire rotation, don't drive on the spare, etc.) can cause driveline
problems. Now, the question is did the previous owner neglect these
items? Maybe, maybe not. But, in general, the XCs are cars most
Volvophiles would not recommend to a friend (noise while turning,
or not).

See this post for Volvos Technical Service Bulleting that lists some
of the guidelines for keeping the AWD system working:

http://www.brickboard.com/AWD/?id=523032

You can also search on "AWD recommended" (or similar) below, to the
right, to find many posts on this topic.