The XML/XSL module renders the result of an XML/XSL transform. The XML and XSL files are identified by their UNC paths in the xmlsrc and xslsrc properties of the module. The Xml/Xsl module includes an edit page, which persists these settings to the SQL database. 

The example you are seeing here on the left, indicates the XML references on my Blogs.. found at http://www.xd.com.au/blogs.xd

XML is used extensively when creating feeds, short cuts of information that link back to the parent site.  I have several people who have used the XML feed on their sites so, from their own site, can see when I've updated my blogs.

XML is one of the most exciting technologies!  This is only a very very simple overview - of how it looks and what it can do.