I don't much about XML document performance, but maybe you are not using the best module? I found XML-LibXML which had an example like this:

  use XML::LibXML;
  # load
  open my $fh, '<', 'file.xml';
  binmode $fh; # drop all PerlIO layers possibly created by a use open
+ pragma
  $doc = XML::LibXML->load_xml(IO => $fh);

  # save
  open my $out, '>', 'out.xml';
  binmode $out; # as above
  $doc->toFH($out);
  # or
  print {$out} $doc->toString();

[download]
If this thing works in binary mode on the file handle and has a C XS implementation in Perl, it will be pretty fast.

XML::Simple says:

The use of this module in new code is discouraged. Other modules are available which provide more straightforward and consistent interfaces. In particular, XML::LibXML is highly recommended and XML::Twig is an excellent alternative.
Update: see following post from Corion++

In reply to Re: Fastest way of XML -> perl structure by Marshall
in thread Fastest way of XML -> perl structure by sectokia

Title:
Use:  <p> text here (a paragraph) </p>
and:  <code> code here </code>
to format your post, it's "PerlMonks-approved HTML":


  • Posts are HTML formatted. Put <p> </p> tags around your paragraphs. Put <code> </code> tags around your code and data!
  • Titles consisting of a single word are discouraged, and in most cases are disallowed outright.
  • Read Where should I post X? if you're not absolutely sure you're posting in the right place.
  • Please read these before you post! —
  • Posts may use any of the Perl Monks Approved HTML tags:
    a, abbr, b, big, blockquote, br, caption, center, col, colgroup, dd, del, details, div, dl, dt, em, font, h1, h2, h3, h4, h5, h6, hr, i, ins, li, ol, p, pre, readmore, small, span, spoiler, strike, strong, sub, summary, sup, table, tbody, td, tfoot, th, thead, tr, tt, u, ul, wbr
  • You may need to use entities for some characters, as follows. (Exception: Within code tags, you can put the characters literally.)
            For:     Use:
    & &amp;
    < &lt;
    > &gt;
    [ &#91;
    ] &#93;
  • Link using PerlMonks shortcuts! What shortcuts can I use for linking?
  • See Writeup Formatting Tips and other pages linked from there for more info.