At this point you need to trace out the power rails to see where the failure is. I have not found the schematics or boardview for the xServe units. Apple had a great system but failed to get the market to grab it. This is also the same problem Apple faced with the original HomePod great speaker just to costly and limited for what people wanted.
I would search out for the '''Xserve (Early 2009) Apple Technicians Guide''' copies are out in the wild it could offer you deeper information on the diagnostic LED’s as well as the boot process. This system is a bit different than a Mac as you only have a terminal session directly.