Xander wasn't very fond of the idea of collecting Mystic Souls by trapping the deceased inside his Chronica. But it was a burden that he had to shoulder since he was Mordred's chosen herald.
However, now that the parasitic soul fragment had been captured, he could no longer latch onto another child. Though it wasn't going to stop the other malicious Dreamwalkers from latching onto helpless newborns, it was a step in the right direction.
Liberating the Conscious Host Soul would have given Xander complete control over the child since he was a Warden of the Soulscape, but because he had violated the unwritten law by defiling the Soulscape with Dream energy, his powers had been revoked.
Xander was now trapped in the Soulscape with no way out. And since it was his first visit to this realm, he had no idea where to look for an exit.