(See also related posting "multiple dates".)
On the issue of what does '196x' mean - does it mean "all of the discrete years 1960 through 1969", as I proposed, or should it mean, as Ed proposes, the continuous interval, and thus the decade, the 1960s?
I don't see too much harm in Ed's proposal, "continuous interval". And, from looking at recent discussion, my impression is that nobody (besides Ed) cares much about the issue.
I do see a the following issues, though.
first, it would follow that 19xx means 20th century. Or actually no, I suppose it wouldn't really, since a century is defined to begin at year 1 - the 20th century begins with year 1901. (This is as opposed to the definition of a decade - a decade begins with a year ending in 0.) The point I'm getting to is that there already is a syntax for century prescribed in ISO 8601: '19' means 20th centtury (there is no corresponding similar syntax for decade). So, we would need to be very careful about all this. 196x would mean the decade of the 1960s. 19xx would mean the interval 1900 through 1999 but it would not mean the 20th century. Perhaps this really isn't a problem at all, just a cautionary note.
Second, we would then have three (!) syntaxes for an interval (for a decade, for example). The 1960s would be (1) 1960/1969 (2) 1960--1960 (3) 196x.
Third, there is a possible utility in allowing the x notation for multiple dates, but see related posting "multiple dates".