The relevant bit of XSLT is:

<xsl:template name="process-list">
	<xsl:variable name="tempname" select="local-name()" />
	<xsl:choose>
		<xsl:when test="contains($tempname, 'ListLocalVal')">
		</xsl:when>
		<xsl:otherwise>
			<xsl:element name="{$tempname}">
			<xsl:variable
name="local-element-val"><xsl:value-of
select="$tempname"/><xsl:text>LocalVal</xsl:text><xsl:variable>
			<xsl:value-of
select="../[local-name()=$local-element-val" />

That should give a syntax error I think, you rather need
  select="../*[local-name()=$local-element-val]"

	Martin Honnen
	http://msmvps.com/blogs/martin_honnen/