Programming XBee to transmit and receive data

An auto gear-head would have better answers for you.

Maybe start a thread on the Sensors forum

I don't think the car I am going to work with (haven't even seen it yet), has an ODB-II interface. By Sensors forum do you mean here or in another site like this? I was following this http://forum.arduino.cc/index.php/topic,92624.0.html

But I don't want to use a mechanical switch, I believe an IR sensor pair would be better.