I'm not using the TSH upgrade, but I was able to locate the origin of the big white "X".
The X appears over a ground target where the main target in a cluster of objects has been inflicted with bomb damage in the mission builder, for example the control tower of an enemy airbase, or the radar at a samsite. If you place an enemy airfield in the mission builder, then use the bomb damage feature on the control tower, when you play the game, there will be a big white X over the control tower, perhaps to indicate objective accomplished in a multi-player game.