I played around with XSLT a little bit some years ago. I found it a painfully verbose language to program in: the extra markup associated with keeping XSLT "legal XML" made the program disappear into the language, so to speak: one twenty-character XML tag starting with "xslt:" looks much the same as another. What really irritated me was that so much of the markup was redundant; maybe purpose-built XSLT editors (or emacs or vim modes) would add that in automatically (someone's already suggested using TT to generate XML).

That's a pity, because XSLT looks like it might be a useful little side-effect-free language. For the moment, though, I'd say that if you desperately want your program to be data, for heaven's sake use Scheme. If I was being paid to produce XSLT code, I'd write a Scheme source filter.