The trapping site structures for ozone molecules isolated in Xe matrices are simulated by a technique of time-going-backwards, showing that single substitutional sites are the most probable. Based on this understanding, molecular dynamics simulations of ultraviolet photolysis of O-3 molecules in Xe matrices are carried out for various trapping sites for temperatures of 10, 20, and 30 K. By examining thousands of trajectories, we found that the photolysis quantum yield in Xe matrices is about ten times higher than that in Ar matrices, and solid Xe can serve as atomic sieve for selecting oxygen atoms in the D-1 state. Our theoretical results are essentially in agreement with the available experimental data.