A couple of questions - I was also evaluating the cars and the prices i got were Rs. 7.5L for SX4 ZXi and Rs. 9.1L for Corolla HE (On-road Delhi) - and this is after dealer and corp discounts... the prices you quote are much lower... cam you pls clarify if these are actual on-road prices??
My take was as follows:
Corolla - very spartan (no alloys, climate control, music system, airbags) but great engine & gearbox. I found the brakes difficult to modulate despite ABS and finally didnt go for it because of the new model expected in Aug 08
SX4 - shockingly cheap interior quality (but still prefer it over Corolla HE), slightly noisy engine, good gearbox and better ride at speeds over 50km/h than Corolla. Its a mixed bag really, but since we already have a NH City, Camry and Aveo I chose the SX4 Zxi simply because its very diff. from most conventional cars
reliability of both cars seems to be decent, and both will have a similar resale value after 3 years (~3.5-4L). Corolla has better FE, which somewhat offsets the higher initial price, depending on the distance you drive.
to summarize: if you drive within the city and carry more than 3 people, go for the Corolla. (but do consider the Cedia if you dont care about depreciation!). If you drive with 1-2 persons on fast roads then go for SX4.
I dont think you would go wrong with either car