First off, why Xterm? It's lightweight, it's easy, and it doesn't suffer from trackpad scroll-madness like GNOME Terminal. Whenever I'm using tmux under GNOME Terminal on my laptop, inadvertent scroll-wheel events often cause me to send the wrong commands or write nonsense into IRC.
Unfortunately, Compiz and Xterm do not play well together. Due to how Compiz calculates its textures, Xterm displays tend to get garbled.
Having had my fill of gnome-terminal, I finally got around to figuring out the workaround for this. Just put the following in .Xdefaults:
! Workaround for compiz issues XTerm*borderWidth: 0
xrdb ~/.Xdefaults && xterm, and you're back in old-school business.