Tested as of September 16, 2012. Played on a Game of the Year edition disk.
I beat the campaign with Xian once. After that, I chose to start a new game, and chose Xian again, and loaded up chapter 5. As soon I started she was level 14, and I had to kill the ram and the 5 zombies in front of the church. After I killed them, the church door opens and I need to talk to "Mother Helen". And she requests that I kill the demon that is inside. So you need to bust open a door. Now, run to the Toxic Mod sitting on the desk in that room, and then I let the Thug kill me. As soon as it says "Time to recover: 6s", press start and choose Load Last Checkpoint. When you do this, you will be right outside the church door, and you will need to speak to Mother Helen, break into that room, and pick up the Toxic Mod, and die by the hands of the Thug, and then Load Last Checkpoint again. Rinse and repeat.
Might want to have the volume on mute because of the church bells.
I tested this only in single player.