Extract .xip files into a specific folder

Maybe try:

xip -x [path to .xip file]

That will unpack the archive into your current working directory.

As for extracting into a specific directory, there is not explicitly an option for this, but xip -x will extract into the current working directory. Therefore, cding to where you would like to extract the file should work; if you specifically need to automate this, a script to the effect of:

#!/bin/sh

xipfile="$(cd $(dirname "$1"); pwd -P)/$(basename "$1")" # a portable "realpath"

cd "$2"
xip -x "$xipfile"

Should do the trick I think?

You can open archive utility itself, go into Preferences and set a specific destination folder and then double click the file. This way you achieved expanding it to a specific destination. ;-)

I would recommend to simply extract the archive into the folder you want trying the following:

xar -xf file.xip -C /path/to/target

(and/or)

tar -zxvf file.xip -C /path/to/target

The xar and tar commands extract the .xip "Content" and "Metadata" in a raw format.

Using a pbzx stream parser you'll need to extract the "Content" which is an lzma compressed Payload; the format is similar to that found within a package installer (eg. .pkg). You can compile the pbzx source from here, or download the compiled binary and install to /usr/local/bin then invoke the pbzx command:

pbzx -n Content | cpio -i

After the command finishes parsing the Content you should get the original form of whatever it was within the .xip archive.

Useful / Additional Info:

$ pkgutil --check-signature file.xip 

Xcode_9_beta_2.xip returns:

Package "Xcode_9_beta_2.xip":
   Status: signed Apple Software
   Certificate Chain:
    1. Software Update
       SHA1 fingerprint: 1E 34 E3 91 C6 44 37 DD 24 BE 57 B1 66 7B 2F DA 09 76 E1 FD
       -----------------------------------------------------------------------------
    2. Apple Software Update Certification Authority
       SHA1 fingerprint: FA 02 79 0F CE 9D 93 00 89 C8 C2 51 0B BC 50 B4 85 8E 6F BF
       -----------------------------------------------------------------------------
    3. Apple Root CA
       SHA1 fingerprint: 61 1E 5B 66 2C 59 3A 08 FF 58 D1 4A E2 24 52 D1 98 DF 6C 60

Notes:

Important: Starting with macOS Sierra, only XIP archives signed by Apple will be expanded. Developers who have been using XIP archives will need to move to using signed installer packages or disk images.

↳ OS X manual page : xip