When using Exceed to connect to the linux box (using rexec and executing xterm), backspace is not mapped correctly. This happens when connecting from other Unix systems (tested with IRIX and Solaris), too. Can be solved by removing the line <Key>Delete: string(0x1b) string("[3~") \n\ from /usr/X11R6/lib/X11/app-defaults/XTerm
It is impossible to configure xterm to work with every possible piece of software out there, and yet work with what it works with now. I consider this problem a local configuration issue where the default configuration is not what is needed for your particular case. The proper solution IMHO is to reconfigure xterm as you have done. I don't see this as a bug at all.