Time for new brake pads? It's not really that hard...
STEP 1: Unbolt the caliper from the fork and lift it away. Leave the hose attached. The pads are usually retained by a pin (some XJ's use two pins) as shown here. Remove the clip from the pin and push out to free the old pads.
Clean this mess thoroughly with brake cleaner, then retract the piston back into the caliper with a c-clamp. Installation is the reverse of assembly.
Finally, treat the system to all new DOT 3 brake fluid. Unless you have special tools like a vacuum bleeder, a second person makes the job much easier.
Connect a clear plastic hose to the bleeder nipple, and loosen it 1/2 turn or so. Put the other end of the hose in a glass jar. Have your assistant squeeze the lever and hold it while you gently re-tighten the bleeder screw. Then the assistant can release the lever. Keep the hose end immersed in the fluid trapped in the jar. Repeat until the fluid is clear. Check and top up the resevoir every 5 pumps or so -- don't run out of fluid in the resevoir or you'll trap air in the brake line!
