My take:
Smart Transform on, nothing changed from Xara's default settings, version 23.8, using browj2's mode /mode2.

Single click the image until Mode 1 is achieved
Drag side, or top/bottom handles to crop
Drag side, or top/bottom handles + ALT to squash

99% of the time I use the crop method to preserve ratios, and use the Push Photo Inside Frame handle to position it.

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