The example suggests, you are dealing with some kind of library information. If that example is real, I assume this kind of information is rather static?

Maybe you are better off importing the XML stuff into a "real" database and later on add/remove only the changes? Furthermore, I assumed that this is not a one-time activity for a given XML document. Even when your XML generator/tool can generate fulldumps only (400MB), adding/removing the changes between two report periods should be possibly faster than importing the whole stuff again...?

It might cost you in total > 800 MB additional disk space (w/o compression). Well, lots of assumptions so far...