>That sounds as ifB  match="(body/div//head)[1]" should do as the XSLT
processor should still see the parent (or perhaps not, what is
transform:transform?, BaseX or exist-db, would need to check how their
XSLT function works exactly).

It's eXist-db's XSLT transformation function, that hands off to Saxon.
The fragment is detached from the node when passed into the function.

works if the div from XQuery is passed in as the root element to Saxon
by exist-db's transform:transform