Function only works once - C

I am trying to create a basic XOR header file for use in some future programs. So far I've got almost everything to work, but I can't seem to use the same function twice. If I call the function to encrypt the string it works, but if I call it again it works. I don't know if I am doing something wrong or if I am missing something obvious. Hopefully someone can point out a flaw in this, because I can't seem to find anything wrong.

Edit: If posting is too much, feel free to trim the code. I've taken a lot already so I'm not just pasting my project and hoping someone will fix it.

// Main.c
#define MAX_LENGTH 255
#define KEY_SIZE 8
int main(int argc, char *argv[]) {
    //Get String to XOR
    char *input = malloc (MAX_LENGTH);
    printf("Enter a string to encrypt: ");
    fgets(input, MAX_LENGTH, stdin);

    if(input[strlen (input) - 1] == '\n') {
        input[strlen (input) - 1] = '\0';
    }

    //Create a random key
    char *pass = _create_key(KEY_SIZE);
    int len = strlen (input);
    printf("Length of key is %d\n", KEY_SIZE);
    printf("Entered String: %s - Password: %s\n", input, pass);

    //Encrypt works fine
    char *encrypted = malloc (sizeof (input));
    _xor_str_s(input, pass, len, encrypted);
    printf("Encrypted String: %s\n", encrypted);

    char *decrypted = malloc (sizeof (input));
    //Crashes here
    _xor_str_s(encrypted, pass, len, decrypted);
    printf("Decrypted String: %s\n", decrypted);
    return 0;
}

//Header File Function
void _xor_str_s(char *str, char *pass, int len, char *out) {
    int i = 0;
    for(i = 0; i < len; i++) {
        *(out + i) = str[i] ^ pass[i % strlen (pass)];
    }
    *(out + i) = 0;
}

char * _create_key(int len) {
    len = !len ? 16 : len;
    char *ret = (char *)malloc (len);
    unsigned int _GLOBAL_SEED_ = (unsigned int)time(NULL);
    srand (_GLOBAL_SEED_);
    int i = 0;
    for(i = 0; i < len; i++) {
        ret[i] = (char)(rand() + 1); //+1 avoids NULL
    }
    ret[i] = '\0';
    return ret;
}