No, you don't pay the xp cost, you pay gold instead. The gold for xp is just tracked separately from the normal gold cost of the item (and is therefore not subject to additional cost reduction beyond that which reduces xp costs).
Which is what I did.
1. To craft the wand it costs 12,000 gold and 960 XP.
2
*. Magical Artisan & Extraordinary Artisan reduce gold cost by 25% each, or 12,000 / 2 = 6,000.
Magical Artisan & Legendary Artisan reduce XP costs by 25% each, or 960 / 2 = 480.
3. The XP cost (480) is converted into a gold at the x5 exchange rate, or 480 * 5 = 2,400.
4. Thus the total price is 8,400, or the 6,000gp in raw materials and the 2,400gp for xp.
5. That's the price for a fully charged wand, the price per charge is one fiftieth of that amount, or 8,400 / 50 = 168.
Your total cost subtracted out of WBL for crafting, say a 10 charge wand, is 1,680gp.
6. Final comparison in this example, the 168gp per charge vs the normal 420gp per charge, 168 / 420 = 0.4 or 168 is 40% of 420.
There is no double use of cost reduction, well other than Magical Artisan
☼ but it applies to both gold and xp cost obviously. Nor is the gold to xp rate tweaked in any manner. 6,000gp for crafting materials and 480xp is 8,400 when the xp is converted to gold and added to the total price.
*Assumes the two 25%er feats stack together for 50%, if they instead are applied after each other it's 56% or ((100-25%)-25%)=56.25. Either way, huge reduction.
☼Version Note: Magical Artisan was originally 3.0 FR material, the 3.5 Player's Guide to Faerun reprinted it making it canonical 3.5 FR material.
If only one set of feats were used, without accounting for craftbot's apparent class based cost reduction, it would be 60%, or ((12,000-25%)+((960-25%)*5)) / ((750*4)*7) = 0.6.
