Here's how PL/SQL Developer (PSD) interacts with a column that shows <XMLTYPE> in it for me.

When I click the three dots, I get a pop-up asking ** View column data externally as "Extensible Markup Language"? ** with the Yes/No buttons and the Don't show this message again checkbox. If I click No, the Large Data Editor window within PSD pops up and shows me the data. If I click Yes, then the program associated with .xml files per Windows starts up. In my case it is Altova's XMLSpy. XMLSpy doesn't appear as a separate program on the taskbar. It instead appears like it is a second copy of PSD in terms of stacking.

If you ever click the "Don't show this message again" checkbox, you can find those under Preferences -> Options -> DSA Dialogs. Removing the line for View.xml restores the pop-up.

I don't recall making any changes within PSD to make it work with the program associated to .xml files. I have had to re-apply the windows level settings a few times over the years due to updates/installs of other things breaking/stealing permissions but that was all outside PSD.