We towed our 4,600 lb, 23' HTT with a first generation Nissan Xterra with a 5,000 lb tow rating. It was a 2000 4x4 with a 3.3 liter v6, 170 HP, 210 ft/lbs of torque. The Xterra towed great. I knew it was back there, but it towed very straight and could get it up to 70 mph without an issue. We towed the HTT with the Xterra up and down the east coast and out to Houston, TX.
Although it towed great, even with an aux. tranny cooler and running full synthetic oils, the engine would run hot if we ran the A/C. Not great considering we lived in GA. It wouldn't get red line hot, but it would run a good bit hotter than normal. I would not consider towing the HTT with the Xterra into hilly terrain. It had a tough time on some of the tall bridges on I-10, real mountains probably would not have been fun.
If we were to do it over again, I would prefer a 4 door full size pickup with a cap to tow. Plus, if you decide after a few years you want a larger trailer, you will need to buy another vehicle to tow the larger one.
-Michael