I have a data element:
<data>&quot;Test&quot;</data>

and a xslt template:
<xsl:template match="data">
   <xsl:value-of select="."/>
</xsl:template>

then I got the output:
"Test"

But I really want it to be "Test" in my output pdf.

Is your data element in an XML file, or do you for
example read it from a DB and build a DOM in memory?
You need not (and *must* not) use entities or character
references with the DOM or SAX APIs.