Dimitre's warning about the sequential occurrence of code in
XSLT templates not implying sequential execution of side-effects
(if any) is still spinning in my mind. I am doing quite a bit
of interaction with the real world in my XSLT work and one of
those is JDBC access.

Looks like the Golden Hammer syndrome.
What's wrong with generating the XML with some Java code or
some other language (like Cocoon XSP or SQL Transformer), and
apply XSLT to the result?