Here then is the same section with the <xsl:iterate> added:

<write_choices>
   <xsl:for-each-group select="$myDir/p/*"

<xsl:iterate select=".">

Inside of any `for-each-group`, the context item `.` is the first item
of `current-group()` so using a single item in the select expression of
`iterate` is likely not what you want.