So why is it that no one remembers Xion?

[Sephiroth0812]

Well, they were both ultimately failures, but which was created first? IIRC, it seems like Xion was introduced prior to Axel leaving for Castle Oblivion, so it seems like Xion was an earlier model that Repliku.

Obviously Xemnas and Vexen never watched Blade Runner, or they would have known better.

Xion was activated first, but both "puppets" were created around the same time and of the same "lot" as indicated by Saix and Vexen in Secret Reports of Days:

Vexen:
The Program is largely on target. No. i, my finest Replica, has proven an even greater success than anticipated.
I intend to take the other vessel—judged unfit for number status—to Castle Oblivion, where I will subject it to further testing.
One thing is clear: could these Replicas not be classified as a special sort of Nobody?

Saix:
Xion failed to complete its mission. If this continues, destroying it and using the next Replica as the Duplicate would undoubtedly yield a higher-grade copy.
No. i was among the initial lot, which naturally raises questions about its capabilities. At present, it is nothing short of broken. I cannot fathom why Xemnas would want to keep it.

Xion was indeed an earlier product. Xemnas sampled Sora's memories prior to their battle that took place in KHFM, and these memories are what would be implanted into Xion's design.

The puppets that were to eventually become Xion and Repliku were created at the same time, but the latter was considered a failure, as Sign pointed out and as Vexen himself states in his secret report entry.

 

[blksabbath74]

Xion was indeed an earlier product. Not only that she was introduced on Roxas' 14th day of being (and the events of CO didn't happen until the 20th-ish day), it was also evident from the fact that Xemnas also sampled Sora's memories prior to their battle that took place in KHFM. These memories are what would be implanted into Xion's design.

So she was created by Xemnas and Vexen using the data Xemnas collected from Sora, the same way that Vexen did Repliku, but then her personality was formed from the memories of Kairi that Namine took from Sora at CO?

 

[Antifa Lockhart]

So she was created by Xemnas and Vexen using the date Xemnas collected from Sora, the same way that Vexen did Repliku, but then her personality was formed from the memories of Kairi that Namine took from Sora at CO?

Yes, initially she was a blank canvas and the memories of Kairi and her experiences with Roxas shaped her. Keep in mind her appearance also changes depending on the person and their connection to Sora.