Simulating a non-linear system in Simulink
If you want to use initial conditions for the \$ X_i \$ variables in the non-linear model, just assign them to the external integrator (1/s) block, or add them as a constant vector after the integrator.

As it is, I am not sure how the simulation is working at all as the non-linear system is not defined for \$ X_1 = 0\$ .