When I put a bill on hold, does Xero show it?

Yes, by default. Mark holds in Xero (Accounts → Settings → Payments, on unless switched off per company): the bill's Xero Reference becomes ON HOLD – <reference>, its planned payment date is cleared and a line is added to its history; release puts the Reference back. Hold reasons: Disputed – quality, Disputed – price, Waiting credit note, Waiting delivery, Pay-less notice, Retention, Other (Other needs a note). A hold can run until a date.