How is your brake fluid level? You didn't say it was going down. If you pump the pedal 10 times and hold it down hard, does it hold firm or slowly go down to the floor? If you are not losing fluid (from calipers, wheel cylinders, or rotted out brake lines), but pedal goes down, it is a bad master cylinder. In any case, being that this Jeep is new to you, by far the best plan would be to pull off all the wheels and drums to look at the brakes. If rotors are rusty, the calipers are frozen up (rust, dust, etc.). XJ's also have a problem with the rear drum brakes not adjusing up properly. And of course check out brake lining. Metal to metal doesn't stop good.