Altova offers free XSLT 1.0/2.0 & XQuery Engine
Still waiting for Microsoft to include XQuery & XSLT 2.0 support? Altova makes the same engines that drive its XMLSpy®, MapForce®, and StyleVision® XML development tools available for use in custom applications – free of charge! Sold!
AltovaXML™ is an entirely free download that includes the Altova:
 |  | XML validating parser |  | XSLT 1.0 engine |  | XSLT 2.0 engine (schema-aware) |  | XQuery 1.0 engine |
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AltovaXML™ features include:
 |  | Well-formedness checking |  | Validation based on DTD or XML Schema |  | XML transformations via XSLT 1.0 |  | Schema-aware XML transformations via XSLT 2.0 |  | XML queries and transformations via XQuery |  | Command line operations |  | COM interface |  | Java interface |  | .NET interface |
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Hopefully its up to its feature-rich billing. I'll definitely be checking it out. Please post commets if you've had any experience with it.