Xfce uses gnome-terminal by default and when you attempt to launch it, the window comes up fine but it does not appear that you can type a command. I noticed this issue and sidestepped it for a long time by using xterm and other terminal clients.
Come to find out that it is a color issue. You can type commands in the window all day long, you will just not necessarily see them. If you do an ls, you will notice the coloring for different file types and realize that the client is actually working.
Edit menu > Profile Preferences
Uncheck “Use colors from the system theme”
Select a color scheme from the built-in schemes or create your own using the palette provided.