"We know that Widmore wants XLocke to remain contained on the island.....but, what else does he want?"

I think this is all related to the Purge which may have been the biggest move in this game. I thought the Purge could have been orchestrated by Smokey somehow because we know Dharma needed protection from him. Since we also know that someone chased Jacob from his cabin, I speculated that Smokey took Jacob's place and started giving Richard new orders that led to the destruction of Dharma. The problem here is that Smokey didn't really get what he wanted despite the Purge.

But, what if Dharma wanted to help Smokey leave the island? They could have thought that, with Smokey gone, the island would be easier to exploit. Or what if opening up that pocket of EM forces was another escape route for Smokey? The Others, knowing that Smokey had to be "corked", could have been forced to put an end to Dharma.

Do we know if Widmore was banished before or after the Purge?

If he was still in charge of the Others at that point, he may have been interested to use Dharma's work for his own benefit while keeping Smokey in check. This could have been what Ben meant about Widmore's outside interest and this kind of double dealings would have led to his exile.

If he wasn't in charge anymore like I think we have seen, then he used what Dharma had learned to be in a position to exploit the island with the added knowledge that Smokey had to be contained.