China's Xiao looked sure to take a step closer to the venue stage of the new tournament in Chengdu when he won five of the first seven frames with top breaks of 73, 56 and 69.
But veteran Pinches won the eighth on the black then added the next two with a top run of 74 for 5-5. And the Norwich potter made a 61 in the decider to clinch victory well after 1am.
India's two players continued to thrive in this event and they are both within one win of reaching a ranking event venue for the first time. Aditya Mehta edged out Jimmy White 6-5, coming from 5-3 down to win the last three frames with top breaks of 53 and 73. And Pankja Advani made 115 and 113 in an impressive 6-3 win over Alan McManus.
China's Cao Yupeng saw off Matthew Selt 6-3 with a top break of 83 while Liang Wenbo made an 80 in a 6-4 win over Adam Duffy. Liu Chuang also made it to the final round by beating Crucible quarter-finalist Jamie Jones 6-2.
Nigel Bond top scored with 93 in a 6-0 whitewash of Anthony McGill while Alfie Burden came from 4-0 and 5-3 down to beat Gerard Greene 6-5. Anthony Hamilton ended the run of Luca Brecel with a 6-3 success.
Here's the line up for Wednesday's final round:
49) Barry Hawkins v Michael White
50) Dominic Dale v Paul Davison
51) Ken Doherty v Liu Chuang
52) Ryan Day v Anthony Hamilton
53) Andrew Higginson v David Gilbert
54) Michael Holt v Pankaj Advani
55) Marco Fu v Alfie Burden
56) Mark Davis v Kurt Maflin
57) Fergal O'Brien v Mark King
58) Jamie Cope v Aditya Mehta
59) Robert Milkins v Liang Wenbo
60) Tom Ford v Cao Yupeng
61) Marcus Campbell v Jamie Burnett
62) Peter Ebdon v Nigel Bond
63) Joe Perry v Barry Pinches
64) Allister Carter v Dave Harold
Ball by ball scoring and results from tournaments