XBee transparent mode with Alternate pins.

I am looking through:
Arduino - Home
and I don't see a whole lot in the way of setup structure for global variables.

The HomePage site talks about stuff that is Arduino-specific. Variable scope is not specific to the Arduino, so it is not mentioned.

So how does that work?

It doesn't. There should be a beginSerial() function that calls Serial.begin().

And I couldn't go from:
or something similar could I?

You could, but there is no advantage to having another function.