Exploiting XOR one-time-pads with alphabet size that isn't a power of 2
Don't think about xor over an alphabet. Only think of it over a binary encoding of an alphabet. I see what you are saying, and what you are hinting at is why Vigenere Cipher is a bad idea in general (one time pad of length $\ell$ that you use over a message of length $k$ for $\ell &lt; k$. However, there is no "meaningful" way of implementing xor with an alphabet that is not a power of 2 as it is defined in terms of bits. Therefore, if there is no binary encoding of your alphabet, then you cannot perform xor. 

As for the unrelated question, we try to avoid modular addition because 1) it is slower and 2) it makes side channel attacks possible