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Yes, you can delete if you uninstall from modules otherwise you'll have error.
But better to get the updated version from reposit. As I can understand the version you are havin is compressing code on upload, and this is why you have one long line of code in the xoops_version.php file.
Download the revised version from here and upload again to see if this make error.
But when you deactivate and uninstall the module do you still have white screen or is the faulty output resolved ??
Programming is like sex:
One mistake and you have to support it for the rest of your life.