Well don't know what's the "best practice" for this kind of stuff is. But for me if the XML file has content that "can be changed/updated over time" then put the file outside of the project or app.
Using web app as example even you probably using
ejb, I put the xml files in a "xml" folder in the root directory of my web domain. Then in my java web app I retrieve them as "http://hostname/xml/blablabla.xml".