So I'm starting with a program that sends a string from a PC to Arduino and should receive this echo, which is not occurring.
Are you saying that a simple echo program is not working?
If so all the other stuff about Xbees and SoftwareSerial is irrelevant and just confusing the issue.
From the PC side, any typed word reaches the Serial Monitor
The Serial Monitor is the PC, what do you mean "any typed word reaches" it?
Post your code, we (or at least I) can't tell nuffin from the above description.
Rob